This is going to be pretty condensed but I wanted to finally record some of my political/political-phil beliefs.
I’m a consequentialist utilitarian. Any other place to start seems arbitrary. So there is no moral purpose outside of the wants of conscious persons. To maximise this we should therefore hope to construct a societal system that lets the most possible people do and have things that they want (both materially and in every other sense). A priori, if a centralised system turns out to maximise this, we should desire it. Or if a decentralised or any other system maximises this, we should desire that.
People say that public management of a variety of things is good because what is individually good for us is often not good for society as a whole. Democracy is no way to achieve this as given the nature of the amount of people’s votes necessary to institute government control of something, under a capitalist system, due to private ownership of goods and various market mechanisms, such a majority can not only exercise just as much power over the shape of the world, but will often not even need to explicitly state their desires for their effects to take place. “The result of human action, not of human design.”
For example, black people only won equal rights in America once the majority had been convinced that this was a good thing. Had there not been explicit laws against desegregation before this, we may have seen black people treated with respect much sooner. The fact is, discrimination on irrational grounds is a type of selflessness, and stupidity at best, because any genuine self-interested employer will choose to employ a skilled black man before a less skilled white man, regardless of race. If the majority of people won’t patronise an equal employer of black people, we can’t expect a democratically elected government to do any better. Progress will only be made through capitalism, in this case.
Contrary to poplar conception I think government emphasises near-sighted thinking more than capitalism does, as people vote more carelessly than they invest, they choose what is good for others less carefully than for themselves. Capitalist systems are much more complex and retain the intricate weights of each person’s beliefs and in much more precise terms. When everyone uses currency, everyone’s values and desires are on the same table and have a sort of sacred equality. When government spends money, it is not with a single brain whose future is tied to the effectiveness of that spending. It is with many borrowed brains, many of whom are disinterested in the outcome of the spending, many of whom don’t have any understanding of what their decisions will do.
On a more abstract/philosophical note, selfishness is the source of all good. Superficially, because all actions are necessarily selfish actions (crucially, people do what they want, because if they didn’t want it then they wouldn’t do it). More meaningfully, as almost all ways to further one’s interests also coincide with helping others at the same time; and moreso under capitalism than government. You’d have to be really really clever to be really successfully selfish at the same time as screwing other people over. Whereas under a government system, groups generally seek to prosper at the detriment of other groups. When one group gets a subsidy it is at the direct expense of the taxed. In a genuine free market economy however, one person’s gain in productivity translates to the ability to gain customers by charging a lower price. When the only permitted human interactions are voluntary ones, all benefits must come in pairs. In an economy wealth is generated by production and virtue, not by redistribution and need. Production and virtue are maximised by a self-fuelling loop. In a system that supports redistribution and need, productive people will begin to envy the needy. If you want more poor people then subsidise the poor. If you want to instill the way of thinking that can end absolute poverty, show them a world where their virtue, and ability, and desire to work will be rewarded. (And don’t introduce a law that makes the poor unemployable while you’re at it.)
Common replies to ‘capitalism makes everyone richer’ is that this doesn’t include the poor. This is empirically not true. In the cases where poor people have an awful time, it’s normally due to government intervention. E.g. the minimum wage’s effects on employment, non-free immigration’s effects on other people’s standards of living. Just to state explicitly an implicit premise here, it seems obvious that a society of rich and poor people is better than a society of poor people. Even though under capitalism you may get a minority of lucky investors (or inventors, or artists etc) who have huge amounts of wealth compared to the poorest in society, this is proportional to the good they have allowed for others via the economy. What is not seen is all the investors who made tricky investments and didn’t get that payed off. The huge potential pay-offs of being a great investor are necessary to ensure that investors invest against the risks involved. Not to mention, people who are rich are a great source of charity.
I submit that personal and economic freedom almost always good utility-maximisers (see microeconomics). When they aren’t, it is highly context-dependant what system would even produce a better result (and when a system works in one situation, the same system applied universally would often have a net negative effect anyway). Market failures can quite easily be corrected by voluntary contracts. Government failures are seldom simple or obvious, and are less prone to swift or permanent correction. The negative effects of government policy are frequently attributed to market freedom (e.g. risky investments leading to market crashes being blamed on too much freedom in finance, rather than the bailouts and policy which propagate such behaviour by divorcing power from responsibility).
In terms of the future, I support a swift move to limited government (public operation of contract-enforcement, protection of individual liberties with courts and police forces, and that’s it). From there, movement to voluntary government/courts/police forces seem in theory a good idea but might actually decrease liberty, so decentralisation to a number of competing provincial systems seems a good bet. (The intrusions on liberty would be pretty minimal at this point and the advantages of fuller liberty similarly small, thus my proportionally reduced concern.)
Don’t be convinced by the handful of examples. The empirical evidence here is incredibly selective, for reasons of making the article succinct. But I instead hope you can see how the principles apply to the evidence you’ve already amassed by yourself, and how ideas that don’t necessarily click on first hearing may be linked in a broader way to the mechanics of society.
Follow the links, there are thoroughly consumed, heartily endorsed economics resources (/songs) throughout the page.