What is "Neoliberalism" anyway?

A viral video by young lawyer Riana Te Ngahue is doing the rounds purporting to explain (for her aunties) something called Neoliberalism.

'A' for effort. 'F' for content. As libertarian Alberto Mingardi observes, very few who use the term have actually taken the time to define it correctly and to trace back its origins. She does take the time, but just like the folk she notes in her video (Tamitha Paul, Chloe Swarbrick, et al) Ms Te Ngahue fails to either define or understand where it came from. 

To be fair, it's not clear. Neoliberalism is like "trickle-down" in economics, or "austerity" in political economy: a term used almost exclusively by critics to characterise and critique a whole ill-defined whole cluster of policies and people, none of whom actually exist. (Take a look at Phil Magness for example explaining 'Why I Am Not a Neoliberal.') "Capitalism" of course was famously one of those words too -- used initially by French socialist Louis Blanc and anarchist Pierre-Joseph Proudhon -- before being taken up by capitalism's supporters. A bit like "queer."

But (apart from Scott Sumner, who thinks it's "awesome") there's no sign of that happening with "neoliberalism."

As Jeffrey Tucker explained way back in 2016, "We need a fix on what this term means. Is there a founding thinker, book, or meeting?" Or, in other words:

What is "Neoliberalism" anyway?

by Jeffrey Tucker

The term “neoliberalism” is being flung around everywhere these days, usually with a haughty sense of “everyone knows what this is.” But do we really? You may think you know, but there’s very little agreement among everyone else.

Is there a founding thinker, book, or meeting? The most common search phrases on Google are these: “definition neoliberalism,” “what is neoliberalism,” and “define neoliberalism.”

The confusion is understandable. Sometimes the term is used approvingly by the mainstream press, as for example to describe France’s Emmanuel Macron. Or Javier Milei. (As if there were much in common between the two.)

More often the term is used as a pejorative by the far left and the alt-right. Here it is said with a sneer to be a synonym for capitalism, globalism, elite rule, ruling-class privilege, and the administrative state.

It's true that there's more doubt around these days about cradle-to-grave government.

What are the reasons for this change?

First, there is the rather obvious fact that government management has failed to live up to its promise. People are far more likely to dread than appreciate any real-world contact with the state. Where would you rather be: the DMV or McDonald’s? The school-district office or a local bar? A military base or a car plant? The courthouse or the shopping mall? Want to deal with a government cop or a private security guard?

Second, private enterprise has turned out to produce far more amazing improvements in our lives; health, prosperity, education, transportation, security, and all the other “commanding heights” of life have been well-served by innovation stemming from entrepreneurship and commercial exchange. Pick your example, but a favourite one is how much transportation alone has improved with ride-sharing technology.

Third, a quiet intellectual revolution has been taking place in the postwar period, with generations of outstanding scholars having rediscovered, then improved, then propagated the insights of classical economics. To be sure, it is now conventional wisdom on the Left that this “neoliberal” intellectual shift is a result of an elite conspiracy dreamed up by billionaires and pushed by well-funded institutions and public intellectuals.

But there is a simpler explanation: the ideas of classical liberalism explain the world better than any alternative. Whether the intellectual change is the prime cause of the shift or incidental to it is unknowable. But this much is true: the shift in ideas is both real and necessary for a change in the paradigm.

Still, a classical liberal is not a neoliberal. We need a firmer fix on what this term "neoliberal" means. Is there a founding thinker, book, or meeting?

Liberalism Needed a Champion

The answer is yes. The thinker is the American journalist Walter Lippmann (1889-1974). He is often called the founder of modern American journalism. Also, if any writer/thinker can be called the founding father of neoliberalism, it is he. His life and times roughly overlap with both Mises and Hayek, the twentieth century’s two most prominent proponents of the classical idea of liberalism. Unlike Lippmann, there was nothing particularly “neo” about either of them. 

In fact, Mises himself had already written the definitive book to champion liberalism in the classical form in 1929. But it was published in Austria, in German. Lippman, as a New Yorker, would never have seen it.

Lippmann was not a professor, though he had an elite education and his brilliance was unmistakable. He was one of the most famous public intellectuals of his time, and a paragon of what was called liberalism in the Progressive Era and through the New Deal. As a founding editor of the New Republic, he was a defender of civil liberties, a proponent of peace, and opponent of socialism and fascism. No one would call him a dissident intellectual but he did resist the totalitarian winds of his time.

The Ideological Crisis

In the interwar period, this class of intellectuals had a sincere concern for the preservation of all the gains of liberty in the past, and sought to find a way to protect them in the future. The situation they faced was grim both in the United States and Europe. Two main extremist factions were struggling for control: the communists/socialists and the fascists/Nazis, which, Lippman realised, were two sides of the same authoritarian coin. The New Deal seemed to be borrowing from both while trying to hold on to certain liberal ideals. It was an unstable mix.

Where was the opposition? In Europe, the U.S., and the U.K, there was also a rise of what might be generally called Toryism or conservatism (or, in the American South, agrarianism). This was not a positive program but rather a reactionary or revanchist pose, a longing for the order of days gone by. In Europe, there were waves of nostalgia for the old monarchies and, with it, the desire to roll back the legitimate gains of liberalism in the 19th century. And with this pose comes a series of demands that are absolutely incompatible with modern life and contemporary human aspirations. 

Lippman knew that some form of liberalism had to be the way forward. But not the old liberalism, which he believed had failed (it led to economic depression and social instability, in his view). His goal was a renovated liberalism. He never used the term neoliberalism (that was invented by a colleague), but that is what it came to be called.

The Good Society

Lippmann’s great book – and it truly is a great book and very much worth a read – appeared in 1937: The Good Society. The book celebrated liberalism and thus rejected socialism, fascism, and Toryism. However, it also rejected laissez faire with equal passion, although you have to get pretty deep into the book to discover this. Lippmann had very casually accepted the bulk of the Keynesian criticism of free markets. He tried to thread the needle: opposing statism, loving liberty, but innovating what he regarded as liberal ends through quasi-statist means.

The book made such an impact that it inspired the calling of a hugely important scholarly colloquium held in Paris in August 1938, in the midst of a growing conflict in Europe and the world. Six months later came the German annexation of Austria, and one year before the Nazi invasion of Poland. These were extremely volatile times, and these intellectuals believed they had a responsibility to do something about righting what was going wrong in the world.

The “Walter Lippmann Colloquium” was organized by French liberal philosopher and logical positivist Louis Rougier. It was attended by Lippmann, and included several other leading French intellectuals, including the great monetary theorist Jacques Rueff. Also in attendance Michael Polanyi from the UK, as well as Germans Wilhelm Röpke and Alexander Rüstow. Most notably Friedrich Hayek came from London, and Ludwig von Mises arrived from Geneva where he was then living in sanctuary after having fled the Nazi invasion of Vienna. 

In short, this was a high-powered group, consisting of the world’s most important liberal intellectuals in the year 1938. It was at this event that Alexander Rüstow coined the term "neoliberalism" to label what they favoured. It was intended to apply only to Lippmann’s vision.

Hayek: neither neoliberal, nor conservative

Again, this was a new way of thinking about liberalism. It was democratic, tolerated a wide degree of regulation, plus welfare states, public education, and public provision of healthcare and infrastructure. But it maintained the core competitive processes of the market economy. The hope was to come up with some stable mix of policies that would lead to rising prosperity and bring about a general public contentment with the social order such that the demand for extremist ideologies like fascism and socialism would be kept at bay. The rising progress and demand for new technologies among the public would similarly outcompete revanchist and conservative sentiments in the political marketplace.

That was the hope in any case. I’m not aware of a report of precisely what took place in this Colloquium but one can imagine that both Mises and Hayek were alternatively pleased and unhappy about being pressed to agree with this view.

Hayek was emerging as the main opponent to John Maynard Keynes, while the other participants had made their peace with Keynes. For his part, Mises held the view that any mixture of state management into the market mix only diminishes the individual’s range of choice, slows economic growth, and introduces distortions that cry out for some political fix at a later date. Neither were believers in the great new Lippmann/Rüstow vision.

The Ur Text

To really understand this vision, let’s take a look at Lippmann’s treatise. It is not shabby. In fact, it is an excellent tutorial in the history of liberty. If only it had stuck with that. Still, the rhetoric is powerful and inspiring. You get a flavour from this passage:

Everywhere the movements which bid for men’s allegiance are hostile to the movements in which men struggled to be free. The programmes of reform are everywhere at odds with the liberal tradition. Men are asked to choose between security and liberty. To improve their fortunes they are told that they must renounced their rights. To escape from want they must enter a prison. To regularise their work they must be regimented. To obtain great equality they must have less freedom. To have national solidarity they must oppress the dissenters. To enhance their dignity they must lick the boots of tyrants. To realize the promise of science they must destroy free inquiry. To promote the truth they must not let it be examined. The choices are intolerable. 

Absolutely wonderful! And for the most part, the book continues in this lovely spirit, enough to feed the soul of the most radical libertarian. You have to get pretty far into the book to discover the “neo” part of neoliberalism. He believed that “liberalism must seek to change laws and greatly to modify property and contract” in a way that rejects laissez faire, a term and a system he completely counterposes to his own.

Neoliberalism includes public provision of education, health care, environmental protection, financial regulation, fiscal policy management, monetary control, and more. In fact, “the purpose of liberal reform is to accommodate the social order to the new economy; that end can be achieved only by continual and far-reaching reform of the social order.”

What Lippmann wanted was a new constitution for a “free state.” What he was rejecting was a state that is neutral to social outcomes – the “nightwatchman state” that the old liberals believed in.

Whereas the original liberals wanted law to be stable and general, pursuing only the most limited functions, the neoliberal vision is of a state that is an active part of the guarding, maintaining, and promoting liberty itself, as understood by a particular vision of what should be. It asserted that liberalism is so important that it must be the primary goal of the state to see it realised. 

In practice, there are no limits to how far this can go.

As an example of a state neutral to outcomes, consider the US Constitution. It is a framework for government and law. It specifies what various branches can do and why, and spells out what they cannot do and why. It contains no great aspiration for how society should look (well, perhaps the “general welfare” clause might apply) but mostly sticks to creating a framework and letting the people take it from there.

Neoliberalism instead wants a living state that is not only adaptive but even aspirational. It should take an active role in the lives of people with the expressed purpose of helping them live freer, flourishing, more fulfilling lives. The state must never lord it over the population but rather be the people’s partner in building prosperity and living out the promise of liberalism.

Where Lippmann Goes Wrong

All of this is interesting, but mostly fantasy. In his many chapters on the liberal state, Lippmann lays out all the ways in which his vision of an expansive state does not trend authoritarian. The official and the citizen are just people and there are no royal prerogatives. Bureaucracies aren’t issuing commands such much as behaving like publicly held corporations, always responsive to the public. There are all kind of intermediate institutions between the individual and the state. The public sector is humane, hospitable, adaptive, creative, and why? Because their power comes from the people, not the dictator or king.

All of this is interesting, but it is mostly fantasy.

Lippman, writing in 1938, was blind to important developments that took place in liberal theory, mostly in response to his vision.

The first is that crucial Hayekian point concerning epistemic humility. Lippmann writes as if he knows for sure how to achieve and judge social results that accord with his vision. It is a normal presumption of most intellectuals. Hayek’s innovation was to see that the knowledge necessary for the right ordering society is not accessible in whole to intellectuals and much less to presidents, legislators, or bureaucrats. It is deeply embedded in social processes themselves, and, in turn, in the minds of individuals making the choices that constitute the driving parts of that process.

The second point completely overlooked by Lippmann is that the players within the state itself have their own interests and designs, just as market actors do. They pursue their own interests. They seek to maximise their welfare. They look for more power, more funding, more prerogatives, and those they serve are the interest groups who can bring them more of it.

The idea that a public bureaucracy can be consistently much less permanently directly toward serving the genuine public interest is lacking in evidence. In other words, Lippman was blind to how the truths that would later be associated with the Public Choice school of economics might impact his vision of liberty.

A third problem is the one Mises identified: neoliberalism chooses the wrong means to realise its ends. Legislating higher wages does not actually raise wages; it throws people out of work. Regulating to protect the environment doesn’t end in doing so; it only devalues property which leaves it to be ravaged by irresponsible stewards. Instituting single-payer health care guts the sector of its signaling systems, its incentives for innovation, and its capacity to be rolled out to ever broader sectors of the population. And because intervention doesn’t achieve its stated ends, it becomes the pretext for ever more meddling in the market process.

These problems doom his system to be as much a fantasy as the authoritarian ideologies he opposed.

The Dangers of Neoliberalism

It was in response to Lippmann that both Hayek and Mises crafted many of their arguments over the coming years. Mises never stopped pointing out that laissez faire does not mean “let soulless forces operate,” as Lippmann seems to suggest. It means letting individuals make the choice over what kinds of lives they want to live, and let those choices drive forward the path of social evolution. Mises’s book Human Action was as much a response to Lippmann as it was to Keynes, Marx, and all the other anti-liberals.

Let’s just posit that we have a state that is determined to advance the cause of liberty – not a state neutral to outcomes but one directed at a certain end. Where will this lead us? It could lead to another form of top-down planning. It can result in practices such as social insurance schemes, heavy regulation in zoning and the environment, taxes and redistribution with the aim of bringing more effective liberty to ever more people. In an imperial state, it can lead to the imposition of planning on foreign nations: the IMF, the World Bank, the so-called Washington Consensus, and the United Nations Declaration on the Rights of Indigenous Peoples. 

It can be the excuse for wars for “spreading democracy” and nation building abroad.

You can say that all these policies are well intentioned. In fact, neoliberalism is the very embodiment of good intentions: we shall free all people! In the best case, neoliberalism gives us a post-war German economic miracle. But it could just easily land in Pinochet’s Chile, often cited as a neoliberal state. In foreign policy, neoliberalism can inspire beautiful reform (Japan after the war), or create a destructive terror state that seethes in resentment (see Libya, Iraq, and Afghanistan).

All of which is to say: the neoliberal can quickly become the anti-liberal state. There is no institutional reason why it would not be so. A state with a social mandate is a roaming beast: you might hope for it not to do bad things but you wouldn’t want to be alone with it in a dark alley.

To be sure, the world owes a debt to neoliberalism. It was this formulation that inspired many countries to liberalise their economies, and even been a reason for many of the loosening of controls in the United States. It led to the reforms in Latin America, China, and even Eastern Europe after the collapse of socialism. Neoliberal ideology is partially responsible for the liberation of billions of people from suffering, poverty, and tyranny.

The downside is also present: the continuation of colonialism by other means, the spread of global bureaucracy, the entrenchment of the welfare state, and the rise of deep-state control over culture, society, and the economy. It is also not politically stable. These institutions feed public resentment and fuel populist extremism, which is the very opposite of what Lippmann wanted. 

At the same time, genuine liberals (often called libertarians today) absolutely need to understand: we are not neoliberals. The great part about neoliberalism is the noun not the modifier. Its primary value is not in what it innovated but what it recaptured. To the extent that it diverges from the beautiful system of liberty itself, it can be the source of the opposite.

Neoliberalism Today

That the term is strewn throughout viral videos and public discourse today is a tribute to the power of an idea. This little seed planted in 1938 has grown into a massive global presence, mostly embodied in international bodies, public bureaucracies, political establishments, media voices, and pretexts for every manner of foreign, domestic, and global action. 

And what has been the result? Some good but a vast amount of highly conspicuous bad. Huge public sectors have held back economic growth. Large bureaucracies have compromised human freedom. It gave life to what is called "crony capitalism" today. Global control has bred nationalist blowback, while corporate monopoly has fed socialist longings.

We are again faced with the same problem today that confronted Lippmann in 1938. Everywhere there are ideologies that seek to put men in chains. We do need an alternative to socialism, fascism, and Toryism. We need to get it right this time. Let’s take the neo out of liberalism and accept nothing less than the real thing.

Freedom is not the correct implementation of a public policy plan. It is not the condition of appointing high-minded and intelligent social and economic managers. It is not the result of sound intentions from a fleet of ruling class intellectuals and major economic stakeholders.

Freedom exists when a people, an economy, and a culture, undirected and unmolested by administrative elites with power, are permitted to live and evolve in peace according to the principle of human choice in all areas of life.

* * * * * 

Jeffrey Tucker is the founder and president of the Brownstone Institute, organiser of the Great Barrington Declaration, and a former Director of Content for the Foundation for Economic Education, where his post first appeared. 

The COVID Moment — Coronavirus and the Economic Crisis

"In a shockingly short period of time, life in the US went from normal and happy to uncertain and essentially terrifying. The economic impact of both the virus and the policy response to the virus is without precedent. This video explores the unfolding of events, the response, the alternative ways to understand and respond to the virus, and the place of fundamental concerns such as freedom and human rights." (Written by Taleed Brown and researched by the team at the American Institute for Economic Research.)

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In a Disease Panic, the Free Market Is Your Friend

In a disease panic, people lose their minds and stop thinking clearly about things that matter. They reach out to authority to save them. In this guest post, Jeffrey Tucker reminds us that when it’s the difference between health and sickness, life and death, the government is the last institution you should want to trust. On the contrary, in times like this, it is human liberty operating within a market framework that saves us. 

In a Disease Panic, the Free Market Is Your Friend

That hand sanitizer you are using, where did you get it? The local store or an online shop. And who made it? Private enterprise, operating based on profit and loss within a market economy. And that mask you are keeping just in case? Same thing. It came from private investment, brought to you by international trade. It cost a buck or two but it might save your life.

Those latex gloves? An amazing innovation with a remarkable history. The first ones were invented at the height of the hated Gilded Age in 1883, a result of the booming oil industry which led to countless derivative products. Disposal versions are wonderfully sanitary but they have only been available since 1964, as innovated by the private company Ansell, founded by Eric Ansell in Melbourne, Australia. Thank you international trade and CER.

That food you are stockpiling, who is selling you that? It’s the local grocery or perhaps a big-box discount store that allows you to purchase vast quantities at a discount. The bottled water you now have, thank the merchant who eschews municipal water while knowing that people expect better.

The equipment at the hospital that will keep you breathing and medicated is manufactured by private enterprise. I can’t think of a single exception. You don’t seriously think that the Ministry of Health or Centers for Disease Control makes heart monitors and respirators, do you?

And the information you are getting on the latest virus updates, what is delivering it to you?

Most likely the world wide web, made possible by private servers, given to you on privately owned fibre-optics cables, flowing to your privately made and distributed computer or smartphone, which today is more capable than supercomputers of 20 years ago, thanks to the driving force of the market to innovate in service of the common person.

Or maybe you are watching a 72-inch television that you picked up for $1000 at The Warehouse to deliver a home-viewing experience not even the richest person would have enjoyed 15 years ago.

And that house right now where you have decided to quarantine yourself, who built that -- despite the predations of planners? Who made the materials possible -- despite the best efforts of regulators? You owe it all to private business operating within a market framework, real estate developers who face a daily test of their wherewithal by facing brutal competition. The home is insured by private companies who bear all the risk of disaster so that you don’t have to.

Who is innovating the home-testing kits that are now reaching Americans in areas most affected? It’s the Gates Foundation as funded by the hated billionaire capitalist who turned his wealth into global philanthropy to fight diseases just like this one. Here is private enterprise at work.

The truth is that the market loves you right now, more amid a disease panic than ever before. It would love you even more if companies were not being browbeaten by government into curbing sales of essential items. Let the prices of sanitiser and masks rise and you draw more into production and distribution. Throttle the market and you reduce supply.

The market would have loved Americans more had the Centers for Disease Control not failed to authorise private companies to test for the virus. It was only after the aggressive protests of the governor of New York that the CDC gave in and let people do what they wanted to do.

And what is the mighty contribution of government these days? To order quarantines but not to tell you whether you can step outside, how you will get groceries, how long it will last, who you can invite in, and when it will all end. To announce a package of measures consisting of announcing there would be a package, some day, but not what it would be. Or when. Don’t try to call the authorities. They have better and bigger things to worry about than your sorry plight that is causing you sleepless nights and endless worry. Thank goodness for digital technology that allows you to communicate with friends and family. 

How many times have you heard something of the following?

“I would take advantage of these low-priced fares and cheap hotels, but I’m afraid of getting quarantined.”

Think about what this statement means. It means that people are more afraid of their own governments than they are of COVID-19. How is that making a contribution to getting through this sad stage of history?

And so, given all of this, it appals me that the bitter-fingered pundits type up articles trashing the market as nothing but a Trumpish plot to pillage you, whereas the government in all its care and nobility is saving you. I waited for days and weeks for someone finally to say what so many wanted to say, which is that “there are no libertarians in an epidemic.”

On the contrary, it is human liberty operating within a market framework that saves us in times like this.

In a disease panic, we are learning that people lose their minds and stop thinking clearly about things that matter. They also reach out to authority to save them. All of this is expected. And it’s very sad. Even sadder is how the unscrupulous power mongers among us use such times to enhance the power of the state over our lives and claim it is for our own good.

We should expect more of our public intellectuals than to use this tragedy to trash market-based institutions that are working 24/7 to provide you and your loved ones what you need to survive this mess. When it’s the difference between health and sickness, life and death, the government is the last institution you want to trust.

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Jeffrey A. Tucker
Jeffrey A. Tucker is Editorial Director for the American Institute for Economic Research. He is the author of many thousands of articles in the scholarly and popular press and eight books in 5 languages, most recently The Market Loves You. He is also the editor of The Best of Mises. He speaks widely on topics of economics, technology, social philosophy, and culture.

This article first appeared at the AIER blog. It has been localised.

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Why this Draconian Response to COVID-19?

"Lock-down." It's become one of this decade's favourite words from everybody's 'favourite' authoritarians --and the go-to response to COVID-19. But Jeffrey Tucker wonders in this guest post whether, if doctors aren't panicking, then everybody else should be? And, since medical professionals aren't commenting on the political response to all this, then perhaps those of us who do care about freedom should at least be asking the obvious questions ....

Imagine if you are the organiser of a major arts and tech event that attracts a quarter-million attendees. One week out from the conference, the mayor cancels your event. Your event is not named specifically, just that all events involving more than 2,500 people are officially banned. He does this using emergency powers, justified in the name of containing a virus.

And that’s it. This is what happened to South by Southwest, one of the most important events in the world in Austin, Texas, which has thus far not reported a single case of COVID-19. Based on last year’s numbers, It’s the end for:

• 73,716 conference attendees and 232,258 festival attendees;
• 4,700 speakers 
• 4,331 media/press attendees
• 2,124 sessions
• 70,00 trade show attendees occupying 181,400 square feet of exhibit space
• 351 official parties and events 
• 612 international acts 
• 1,964 performance acts

Local merchants are devastated. All hotel and flight reservations are lost. It’s a financial calamity for the city (last year brought half a billion dollars for local merchants) and for untold millions of people affected by the abrupt decision.

Draconian, to say the least.

Making matters worse, a vicious and completely false report published by Variety said that the festival was aching for the city to make the call so that the festival could collect insurance money. This turns out to be entirely wrong: South by Southwest had no insurance against infectious disease. It was a smear and response to mass frenzy. After all, a petition on Change.org signed by 55,000 people had demanded the cancellation.

The city acquiesced to the mob. A grand and glorious conference was destroyed – the first of many this season.

Italy now has 16 million people under quarantine, which is to say that they are prisoners.

Anyone living in Lombardy and 14 other central and northern provinces will need special permission to travel. Milan and Venice are both affected. Prime Minister Giuseppe Conte also announced the closure of schools, gyms, museums, nightclubs and other venues across the whole country. The measures, the most radical taken outside China, will last until 3 April.

Americans have been quarantined on cruise ships and then forced to pay for their later hospitalisation. The government that quarantines you has zero intention to pay the costs associated with your care, to say nothing of the opportunity costs of missing work.

The press isn’t helping. The New York Times has cheered it all on, aggressively advocating that governments go Mediaeval on this one.

In six months, if we are in a recession, unemployment is up, financial markets are wrecked, and people are locked in their homes, we’ll wonder why the heck governments chose disease “containment” over disease mitigation. (Then the conspiracy theorists get to work.)

The containment strategy was neither debated nor discussed. For the first time in modern history, governments of the world have taken it upon themselves to control population flows in the hopes of stemming the spread of this disease – regardless of the cost and with scant evidence that this strategy will actually work.

More and more, the containment response is looking like global panic. What’s interesting, Psychology Today points out, is that your doctor is not panicking:

COVID-19 is a new virus in a well-known class of viruses. The coronaviruses are cold viruses. I’ve treated countless patients with coronaviruses over the years. In fact, we’ve been able to test for them on our respiratory panels for the entirety of my career.
    We know how cold viruses work: They cause runny noses, sneezing, cough, and fever, and make us feel tired and achy. For almost all of us, they run their course without medication. And in the vulnerable, they can trigger a more severe illness like asthma or pneumonia. 

    Yes, this virus is different and worse than other coronaviruses, but it still looks very familiar. We know more about it than we don’t know. 

    Doctors know what to do with respiratory viruses. As a paediatrician, I take care of patients with hundreds of different viruses that behave similarly to this one. We take care of the kids at home and see them if the fever is prolonged, if they get dehydrated, or if they develop breathing difficulty. Then we treat those problems and support the child until they get better.

Meanwhile, the New England Journal of Medicine reports as follows:

On the basis of a case definition requiring a diagnosis of pneumonia, the currently reported case fatality rate is approximately 2%. In another article in the Journal, Guan et al. report mortality of 1.4% among 1,099 patients with laboratory-confirmed Covid-19; these patients had a wide spectrum of disease severity. If one assumes that the number of asymptomatic or minimally symptomatic cases is several times as high as the number of reported cases, the case fatality rate may be considerably less than 1%. This suggests that the overall clinical consequences of Covid-19 may ultimately be more akin to those of a severe seasonal influenza (which has a case fatality rate of approximately 0.1%) or a pandemic influenza (similar to those in 1957 and 1968) rather than a disease similar to SARS or MERS, which have had case fatality rates of 9 to 10% and 36%, respectively.

Slate’s piece on this topic offers more perspective:

This all suggests that COVID-19 is a relatively benign disease for most young people, and a potentially devastating one for the old and chronically ill, albeit not nearly as risky as reported. Given the low mortality rate among younger patients with coronavirus—zero in children 10 or younger among hundreds of cases in China, and 0.2-0.4 percent in most healthy nongeriatric adults (and this is still before accounting for what is likely to be a high number of undetected asymptomatic cases)—we need to divert our focus away from worrying about preventing systemic spread among healthy people—which is likely either inevitable, or out of our control—and commit most if not all of our resources toward protecting those truly at risk of developing critical illness and even death: everyone over 70, and people who are already at higher risk from this kind of virus.

Look, I’m obviously not in a position to comment on the medical aspects of this; I defer to the experts. But neither are medical professionals in a position to comment on the political response to this; mostly they have assiduously declined to do so.

Meanwhile, governments are willy-nilly making drastic decisions that profoundly affect the status of human freedom. Their decisions are going to affect our lives in profound ways. And there has thus far been no real debate on this. It’s just been presumed that containment of the spread rather than the care of the sick is the only way forward.

What’s more, we have governments all-too-willing to deploy their awesome powers to control human populations in direct response to mass public pressure based on fears that have so far not been justified by any available evidence.

Based on the Italy and Austin, Texas, precedents, any mayor of any town anywhere can right now declare a state of emergency, cancel events, shut malls, and close parks. Who is to stop them from shuttering stores, restaurants, schools, and churches, and quarantining whole neighbourhoods? [After all, they did it all so eagerly here in Christchurch after the earthquakes.]

For this reason, we have every reason to be concerned.

Are we really ready to imprison the world, wreck financial markets, destroy countless jobs, and massively disrupt life as we know it, all to forestall some uncertain fate, even as we do know the right way to deal with the problem from a medical point of view? It’s at least worth debating.

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Jeffrey Tucker is Editorial Director for the American Institute for Economic Research. He is the author of many thousands of articles in the scholarly and popular press and eight books in 5 languages, most recently The Market Loves You. He is also the editor of The Best of Mises. He speaks widely on topics of economics, technology, social philosophy, and culture.

His post first appeared at the AIER blog.

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The Strangest Thing about the Democrat Debate

One presidential "debate" or other is hardly important. Or revealing. Except, strangely, as guest poster Jeffrey Tucker discovers, when all the candidates are saying the same thing ...

It struck me about one hour into what Politico calls “the snarling incoherence of the latest Democratic presidential debate” that it was “painfully hard to follow.”

What precisely was so painful?

It was not what divided this gaggle of politicians vying for your affection. It was what united them: They all agree that their job is to have a plan for your life. This is the source of the pain.

How did it happen that all these candidates have come to believe that it is their job to plan the economy, manage your finances, fix your job, improve your wages, get you to the doctor, get your kids educated, keep you off drugs, make you equal to others, give you climate justice, grant you vacation time, and one thousand and ten other things?

That this is what they are supposed to do is not even questioned. And if you listened carefully, you will see that all of them agree that there is only one direction for government power: more. Everything without exception can be solved with more money, more power, more bureaucrats, more engagement, more plans, more intelligence, more focus. More of everything that means politics.

No longer is the president the person who presides over the affairs of state. All of life has become an affair of state. The president is not just an administrator of things related to the federal government. He or she is the head of the whole country and everything and everyone in it, plus sizable parts of the rest of the world.

So what are they are all up there talking about? They are talking about what they plan to do with your life and your money. That’s what was so painful. They have no clue about any possible limit to their planning.

All the while, every single person watching this debate has his or her own plans for life. Real people are planning their futures, navigating the job market, dealing with the boss or trying to find good employees, watching their savings, talking with their financial planners, figuring out whether to get another degree or go to work, wondering about partners, thinking about children, worrying about their kids’ education, considering whether to raise children in a religion and which one, when to take a vacation and where, what to do about an uncle’s drinking problem, worrying about ageing parents, wondering whether to rent or buy, and one million other things.

We are all trying to figure it out. It’s called life planning. We all do it every day. The underlying institution that makes our plans realisable is that we still have some freedom and we very definitely have the right to manage our own lives and resources. This is essential to what it means to live the good life.

The trouble with the seven people on the stage this week is that they have little or no regard for our personal plans. It’s their plans for us that matter. To them, our lives are mere abstractions.

To them, we are simply there to be manipulated into granting them money and votes. Once they get power via democratic means, they are done with us. Our only job is to cough up money and comply. That presumption is why the evening seemed so creepy.

They don't even talk about people except as clumps of voters. They talk of the “working classes,” “African-American women,” “minority populations,” the “underemployed,” the “underinsured,” the “immigrants,” ad infinitum -- but these are not actual living, breathing, choosing individuals, they are categories of voters, people being drafted against their will into voting blocs.

And with that comes a preposterous game of pretending that they know things that they cannot really know. The point was obvious in the question about what to do about pandemic disease should the US be hit. They all strutted and pronounced on the issue as if they knew precisely the right path.

Not one person said a normal thing like: “There is a lot we do not know about the Coronavirus, and we are all sifting through information as it becomes available. Each of us wants to stay safe and all of us have a strong interest in taking every precaution.” Which is about as much as they can believably say.

Such a statement however would be a shock because it flies in the face of the ethos of this debate, which is that rather than electing a mere head of state, we are electing an all-knowing, all-powerful godlike brain.

Where did this idea come from that the president is not just the head of the state but also the head of the whole of society and everything within it? It’s been around a very long time but only recently has it been made so explicit, and become an open and conventional presumption behind all the political rhetoric.

The first time I experienced it so overtly in America was 2015, when I heard the second campaign speech by Donald Trump when he was first seeking the Republican nomination. He stood in front of an audience and talked not as if he were running to become a constitutional head of state in a republic governed by the rule of law, but as if he was running to be the CEO of America. It was strange and alarming. It never occurred to him that there might be limits on his power that would be justified.

This speech rattled me. It struck me as the inauguration of a new era in politics.

And now here we are almost five years later, and guess what? The Democrats speak exactly like him. They have learned from Trump as good students. They are all running to be the new CEO of the whole country, just with a different set of priorities.

They all have a plan for your life. Their plans naturally overrule your plans because they will have the power and might of government behind them. You merely have things like human rights that are, in a country that hosts the largest and most powerful government ever, rather vulnerable to rampant violation.

Why do we put up with it? If you had a co-worker who spoke to you about your life and your plans the way members of the political class do as a matter of habit, you would avoid him like the Coronavirus. You would plan your lunch hour to miss him, be on the phone when he walked by your desk, and maybe manoeuvre behind the scenes to get him pushed out. A person like that would be seen as threatening, even pathological.

And yet we somehow put up with it from politicians. We watch with bemusement and think: what the heck is wrong with these people? Why are they so lacking in the normal human grace of willing to live and let live? It’s because they have all drank the Kool-Aid of power. They want it desperately and they will do anything to get it.

And truly, does anyone actually believe that this gang of political performers has access to some magic machine that will improve your life better than you can yourself? Some people do believe this. But fewer every day. If this political season has had any merit to it at all, it is that it has made the point that their presumption of omniscience and omnipotence is a dangerous path.

And yet, despite all their silly and potential dangerous antics, what can we do but live our lives as we always do, planning and struggling, sometimes achieving and often failing, grappling with uncertainty and opportunity, doing our best to cobble together a good life, raise our children well, and prepare for the future as best we can? 

In this sense, none of these people can help. The best that all of them can do is to get out of the way.

* * * * * 

Jeffrey A. Tucker

Jeffrey A. Tucker is Editorial Director for the American Institute for Economic Research. He is the author of many thousands of articles in the scholarly and popular press and eight books in 5 languages, most recently The Market Loves You. He is also the editor of The Best of Mises. He speaks widely on topics of economics, technology, social philosophy, and culture.

His post first appeared at the AIER blog.
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"In the future, any president of a different party than the [U.S.] House of Representatives will be immediately impeached. I'm kind of for that actually." #QotD

"In the future, any president of a different party than the [U.S.] House of Representatives will be immediately impeached. I'm kind of for that actually."
       ~ Jeffrey Tucker
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Drunk Driving and Fake Science

There's something wrong with a system that presumes guilt then relies on some secret test, rather than observable behaviour, to prove it. Especially when a New York Times investigation shows the science behind testing is bogus. In this guest post, Jeffrey Tucker explains why criminalising something that depends on a pseudo-scientific test rather than observable criminality was always wrong. 

Almost everyone I know has a story to tell about themselves, a friend, a friend’s friend. It’s about the abusiveness of the police in the enforcement of drunk-driving laws. I’ve known people who were quite sure that they were not over the legal limit but suddenly found themselves cuffed in the back of the police car.

I know a guy who was arrested out of his own driveway, having driven home perfectly safely. I’ve seen lives ruined and wrecked by a system that presumes everyone is guilty and then proves it was scientific machines that claim to be accurate to three decimal points. The level of paranoia on this subject in American life is palpable.

So it’s actually mind-blowing – or maybe once you hear this it will seem incredibly obvious – that the New York Times has published a massive investigation that shows that the science behind the breathalyser is bogus. Tens of thousands of American arrests have been wrong. Cases are being thrown out around the country. The company that makes the machines for the police stations won’t share its technology or submit to a serious scientific review of its technology. Lives are being ruined even as the evidence piles up that vast numbers of arrests for “drunk driving” are wholly bogus.

Quoting the Times:

A million Americans a year are arrested for drunken driving, and most stops begin the same way: flashing blue lights in the rearview mirror, then a battery of tests that might include standing on one foot or reciting the alphabet.
    What matters most, though, happens next. By the side of the road or at the police station, the drivers blow into a miniature science lab that estimates the concentration of alcohol in their blood. If the level is 0.08 or higher, they are all but certain to be convicted of a crime.
    But those tests — a bedrock of the criminal justice system — are often unreliable, a New York Times investigation found. The devices, found in virtually every police station in America, generate skewed results with alarming frequency, even though they are marketed as precise to the third decimal place.
    Judges in Massachusetts and New Jersey have thrown out more than 30,000 breath tests in the past 12 months alone, largely because of human errors and lax governmental oversight. Across the country, thousands of other tests also have been invalidated in recent years.The machines are sensitive scientific instruments, and in many cases they haven’t been properly calibrated, yielding results that were at times 40 percent too high.

The story adds another several thousand words of horror stories about the use of fake science in the service of the machinery of compulsion and coercion that has entrapped millions of Americans and vexes all non-teetotallers on the road today.

It turns out that these expensive machines, both the ones carried by cops and the larger machines at police headquarters, are provided by only a few companies in the world and they are unwilling to open up their guts to serious peer review. They are poorly maintained and yet the numbers are invoked in court daily. The police have every incentive to allow them to be wrong so long as the results end in conviction.

The few times in which states mandated tests of the tests have resulted in shocking results. Something called the Intoxilyzer 8000 was tested in Vermont in 2005 and produced inaccurate results in “almost every test.” As it turns out, the only scientific way to determine blood-alcohol content is with blood tests. There are too many variables to make the breath alone reliable and yet breathing tests are the whole basis of drunk-driving enforcement.

The rounding-up problems and inflated numbers alone are raising questions about 45,000 convictions in Massachusetts and New Jersey. The trouble is that once the fake science is part of the court records, the accused has no viable option but to plead guilty and face a jail sentence and fines and ruined driving record, even if the person knows for sure that he or she was not drunk. When it’s the state armed with fake science vs. an individual motorist who had a couple of beers, everyone knows who wins.

This is a classic case of the dangers of scientism in the service of state-based justice. Put on the lab coat, sell the government a fancy machine, harass people with unending intimidation, and the result is vast injustice based on bad science. Citizens themselves have no recourse. This has been going on for decades in the United States and yet we are only now finding out about it.

There was always a potential for injustice at the heart of the rule against drunk driving since enforcement would always be based not on evidence of reckless driving but rather on the content of one’s blood. It was that which was being criminalised. In fact, there are many reasons one might drive dangerously: texting, physical exhaustion, sleep deprivation, bad day at work, fight with a lover, and so on. Nor is it the case that having a few necessarily and always results in the endangerment of others. The only real sensible approach, then, is for the police to enforce the traffic rule ticketing and arresting based on what the driver actually does.

The anti-drunk driving regime in America was not based on that. Rather, it criminalised something that required a fancy scientific test to discover complete with black-box machines out of science fiction. Even if you are driving perfectly well, complying with all rules, endangering absolutely no one, you would be subjected to brutality at the hands of the police solely upon the discovery of a chemical in your blood, which, as it turns out, cannot be reliably determined based on any existing technology.

Think about this. The whole world is horrified by Elizabeth Holmes and Theranos’s claim that it could detect diseases via a tiny pinprick on the finger. That this company raised billions on an unverified claim has been the subject of vast outrage and criminal investigations. And yet we have what appears to be the exact same situation with the detection of drunk driving and yet it’s gone on for decades without much in the way of incredulity putting any damper on the arrest-and-jail machinery of the state.

Why is this? I would say the following. Theranos was subjected to a market test. Breathalysers and Alcotests and so on exist within the apparatus of the state and have thereby been shielded from serious scrutiny. It has taken the New York Times and its intrepid reporters to blow the cover, and yet, realistically, it will be years before anyone can put a damper on the machinery of personal destruction that is currently in operation even in your hometown.

There are lessons here. The combination of state power and pseudoscience is a dangerous one. Criminalising something that depends on the scientific accuracy of some secret test rather than observable behavior is itself fraught with dangers. The state cannot be trusted to police its own application of science in service of itself. It will always face an incentive to exaggerate to gain more money and more convictions.

Now is the time seriously to rethink the entire machinery of drunk-driving enforcement.

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 Jeffrey A. Tucker is Editorial Director for the American Institute for Economic Research. He is the author of many thousands of articles in the scholarly and popular press and eight books in 5 languages, most recently The Market Loves You. He is also the editor of The Best of Mises. He speaks widely on topics of economics, technology, social philosophy, and culture. He is available for speaking and interviews via his email. Tw | FB | LinkedIn.

This article first appeared at the AIER blog.

NB:  Drink-driving law in New Zealand, and seven things you need to know that may help you if tested.

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"The vast gulf that separates activist politics from real life seems to be growing. Leading politicians portray a population cowering in fear, seething with resentment, obsessed with inequity, longing for a time gone by… and begging politicians for the strength and vision to change things. Yet in the US of 2016, once we turn off the media and shut down their voices, we discover a different reality all around us..." #QotD

"The vast gulf that separates activist politics from real life seems to be growing. If you listen to the leading politicians talk these days, you would think that the whole of American life is currently dominated by violence, injustice, discrimination, pillaging, isolation, deceit, fear, poverty, suffering, and decline generally. There are left and right wing versions of this story, but each portray a population cowering in fear, seething with resentment, obsessed with inequity, longing for a time gone by… and begging politicians for the strength and vision to change things.
    "It illustrates how it is that states thrive in bad times more than good, and how even a slight downtick in the rate of economic growth can enliven politicians to advertise their services to people clamouring for answers.
    "And in the US of 2016, once we turn off the media and shut down their voices, we discover a different reality all around us: more choice, more convenience, more peace, and new technologies and options that make life ever more wonderful. Because markets are still working and human ingenuity has not been entirely shut down by regulatory controls and taxes, we still see beauty all around us; so much so that you barely recognise the world that politicians describe. It’s truly bizarre, this disconnect.
    "And what strikes you most about the world today is precisely how little confidence people have in political solutions. Indeed, they are mostly not buying what the politicians are selling. It’s no wonder that roughly two thirds of Americans tell pollsters that they are both dissatisfied and alarmed at mainstream political options, and one in four are willing to say that they dislike both leading candidates. If you feel the same, consider that you are in the majority."
          ~ Jeffrey Tucker, from his book Right-Wing Collectivism: The Other Threat to Liberty (pp. 31-32)
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Seeking social justice by means of the state ends only in destroying social harmony

The state is the wrong means to seek social justice. Take this path and you create discord, explains Jeffrey Tucker in this guest post: The violent hatreds, tribalisms, acts of revenge, and never-ending escalation of the war between left and right (and between races, religions, sexes, and classes) are exactly what you would expect to get when you attempt to organise life according to the zero-sum game that is politics.
Liberalism proposed a totally different idea, says Tucker: It said that everyone should be free to live as they want provided that didn’t interfere with others’ ability to do the same -- to live and let live and embrace the kind of legal order that instantiates that principle. It's the only path to the social harmony that I and so many others seek.

Here is what happened to social harmony

Guest Post by Jeffrey Tucker

America is fracturing right now, and this earnest New York Times column by David Brooks convinces me that neither he nor the legions of other public intellectuals currently warning of the fracturing of the country really have any idea why.

In Brooks’s ideal society, as he explained in his influential 1997 article “A Return to National Greatness,” we should have a large and activist central state that controls national life and takes care of all needs and rules over a happy and unified people who take joy and pride in our civic institutions." That pretty much describes the ideal society of most other public intellectuals as well.

Neither he nor they have given up the dream, which accounts for the palpable shock at the frenzied tribalism in evidence during the controversy over a Supreme Court pick. “This is a complete pulverisation of the actual individuals involved in this case – a retreat from complex particularity to simplistic group prejudice,” writes Brook. “The core problem behind all of this is a complete breakdown in the legitimacy of our public institutions.”

That sounds terrible, but what is it that he wants? He wants a big state plus civic unity. And you can see from his column that he is completely mystified about why this is not happening. Indeed, he is panicked (and maybe he is right to be) about the sheer wickedness of the current moment in politics.

Why the Shock?

Here is what frustrates me about this perspective. It nowhere acknowledges that the current moment is precisely what liberalism (or libertarianism) predicted would happen if you grow the state beyond the most minimal functions pertaining only to a narrow range of particular crimes.

The classical liberal (or libertarian) is not surprised by the growth of partisan tribalism as the state itself metastasises because we understand that the divisions of big-government's pressure-group politics demand it. 

We Chose Wrongly

Over the last hundred years, we've chosen the path of building a total state (a state that knows no limits to its power), and thus did the prediction of the liberals become true, most obviously now in times of relative peace and prosperity (it takes war and depression to unite people in the way that Brooks and others imagine that they should be).

The violent hatreds, tribalisms, acts of revenge, and never-ending escalation of the war between left and right (and between races, religions, sexes, and classes) are exactly what you would expect to get when you attempt to organise life according to the zero-sum game that is politics.

Why is it that so few are willing to see what would strike any liberal from the past, or any educated libertarian of the present, as incredibly obvious?

Brooks is a smart guy. But he can't bring himself to admit the core failing of modern political life: the attempt to achieve social harmony through political means. It can't happen. It's the wrong means to a good end. It's wrong because behind the veil of good intentions of political organisation is the only real tool that the state has, which is the threat of violence against person and property. That is not a basis for social harmony.

The Best Guarantor of Social and Economic Harmony

The liberal conviction from the last several hundred years is that the best guarantor of social and economic harmony is not government), but freedom. Frederic Bastiat wrote his last book with that title. “Liberty!" he proclaimed: "Therein, in the last analysis, lies the source of harmony. Oppression! Therein lies the source of discord. The struggle between these two forces fills the annals of history.”

To be sure, Bastiat was no utopian. It is the social and economic planner who imagines some ideal state to bring about through force. He saw in the institutions of freedom the capacity for improvement. “Harmony does not consist in the complete absence of evil, but in its gradual reduction,” he wrote.

Lord Acton said the same. Power, he emphasised constantly, does not solve social problems; it leads to moral corruption, conflict, and violence.

By the end of his own life, economist Ludwig von Mises had come to understand that the political landscape is divided between two groups. First, there are the harmonists who believe in leaving society alone to manage itself because exchange and association leads to ever more favourable, prosperous, and peaceful social outcomes. Second there are the anti-harmonists who believe that “a community of interests exists only within the group among its members. The interests of each group and of each of its members are implacably opposed to those of all other groups and of each of their members.” Given this, “there should be perpetual war among various groups” with government there to foment the whole ghastly scene in the name of managing it, bringing justice, righting wrongs, making society great, or whatever slogan is popular among the right or the left.

The anti-harmonists, because of their dedication to coerced outcomes, end up causing society to behave precisely as they imagine it does and should behave. They end up creating the world of their fevered imaginations. The harmonists, in contrast, are left calmly to explain that there is another path, but people are less likely to listen in the midst of tribal wars in which the winning group takes all.

The pressure-group warfare of their tribal politics deafens them to those who make the point that this warfare of one pressure group against another is precisely what makes big politics tick!

No Forced Unity

You can do easy mental experiments to discover this for yourself. Let's say that the political elites announce that there would be only one religion, and one sect within that religion, that will prevail in all matters related to morality and theology. What do you suppose would follow such an announcement? More peace or more civic war?

The same pertains to every other aspect of life. What should be done with our private associations, our enterprising aspirations, the property that we own, our desire to travel, our desire to work with others in a business, our willingness to engage in exchange with others, our desire to speak and write what is on our mind, our affections and familial ambitions, our preferences over art and music, the personal preference for what we smoke and eat, and so on through the whole list of life activities?

Every attempt to manage these things from the top down fuels social division. There are literally millions of examples but the most insidious among them touch on the most complex areas of life such as gender relationships in professional life.

For example, when in the 1990s the courts, regulators, and Congress decided to legislate against sexual harassment, it seemed like an innocuous affirmation of meritorious cultural change that was already taking place. Who could possibly object to such laws? All these years later, we see how this use of legislative force mutated into a brutal war in which each side claims the other is plotting the disempowerment of the other.

The anger is palpable on all sides, precisely what you expect when people literally believe they are fighting for their identity and lives. 

And, of course, in the end, well-intentioned laws are being used to manipulate political outcomes. All state interventions, even those that seem to push completely wonderful social results, end up becoming weapons – and weaponising the people who use them to gain advantage over others.

Who benefits? Those who seek power over others – and that’s true whether the power seekers wave flags of the left or right.

The truth that they ignore however is this: That the state is the wrong means to seek social justice. Take this path and you create discord.

Liberalism proposed a different idea. It said that everyone should be free to live as they want provided that didn't interfere with others' ability to do the same. It's the law of equal freedom, enforced by decentralised institutions, the gradual evolution of social norms, and the courts of taste and manners. People are guaranteed rights to liberty, property, and associations of their own choosing; otherwise, the state does not interfere. This approach built civilisation. It created the most harmonious societies in the history of humankind.

Brooks is at a loss about what to do about the civil wars of our time, and pathetically ends up suggesting small group seminars in which we talk amongst ourselves so we gain greater understanding.

The real answer is to live and let live and embrace the kind of legal order that instantiates that principle. It's the only path to the harmony that he and so many others seek. The alternative is to keep tearing each other apart in a great struggle to control the whole.

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Jeffrey A. Tucker is Editorial Director for the American Institute for Economic Research. He is the author of many thousands of articles in the scholarly and popular press and eight books in 5 languages. He speaks widely on topics of economics, technology, social philosophy, and culture.

Is Nationalism the Friend or Foe of Liberty?

The question is, is Nationalism the friend or foe of liberty? In this guest post, Jeffrey Tucker argues that a nationalism that presents itself as a friend of liberty is one that must wilfully ignore the most bitter lessons of the last century, while eschewing the greatest lesson of all: that the only true guarantor of liberty is liberty itself.

Is Nationalism the Friend or Foe of Liberty?

Guest post by Jeffrey Tucker

Israeli scholar Yoram Hazony is hitting the opinion pages (excerpts from his new book) with a provocative thesis: that nationalism is not a threat to liberty but rather a guarantor of it. His argument is about stability under democracy. It requires mutual trust, fellow feeling, cultural cohesion, a sense that the other could be you because you share similar values, he argues. “Nationalism was the engine that established modern political liberty,” he claims, and now we need nationalism to maintain the kind of political stability that undergirds freedom itself.

This is near impossible in what he calls “multinational states,” by which he means a geographic territory too mixed up in terms of language, religious allegiance, and culture. He cites unsustainable states like Iraq, Syria, and Yugoslavia. Such mixing has worked, more or less, in the US because “the original American states shared the English language, Protestant religion and British legal traditions, and they had fought together in wartime.” New additions to the mix (Catholics, Jews, and former slaves) were acculturated only due to pre-existing cultural dominance.

He further argues that the national consensus in the US no longer exists, due to high rates of immigration. This has shattered mutual loyalty, he maintains, so as regards America as an experiment in multinational diversity: “It’s not clear that the U.S. is succeeding at this task.”

Good and Bad Nationalism?

You might be thinking you have heard this line before. You have seen the memes from the far right, read the tweets, bumped into the fanatics at rallies. Such sentiments have been credited with getting the current president elected.

But Hazony is careful to distance himself from such movements.

Every nationalist movement contains haters and bigots (though not necessarily more of them than are found in universalist political and religious movements). But nationalism’s vices are outweighed by its considerable virtues. A world in which independent nations are permitted to compete freely with one another is a world in which diverse ways of life can flourish, each an experiment in how human beings should live. We have good reason to believe that such a world holds out the best prospects for freedom, for innovation and advancement, and for tolerance.

If you had never read an argument for nationalism that is calm, reasoned, and rooted in history, you might find his point persuasive. Many liberals (and pre-libertarians) a century ago certainly did so. [But they didn't yet have the evidence before them of a century of bloody nationalism as evidence against the thesis - Ed.]

Back then, the pressing issue, on which the fate of civilisation rested, was the following: what should be the standard for the drawing of borders after the chaos of Great War? It was a war for democracy, they said but it was the death knell for the old multinational monarchies of Europe.

Political loyalty in the old world was based on dynasty, intermarriage of rulers, deal making, and religious control. In the new world, there is no question that democracy would be the watchword. The nobility would no longer rule; the people would be in charge. A unity global democracy is impossible. There must be states and there must be borders, so what constitutes the basis for nationhood?

Liberalism had a number of answers to the problem and most came down to precisely the terms that Hazony presents here. States should be organized along the lines of fellow feeling, mutual trust, and citizen identity in whatever form.

Liberal Nationalism?

Ludwig von Mises, writing in 1919, was at that immediate post-war stage highly sympathetic to the nationalist project. What’s a nation? Mises rejected the then-fashionable trope of carving up the human population by race on grounds that the supposed science of the project was “a thicket of error, fantasy, and mysticism.” Instead, he wanted to define a nation specifically according to one overriding standard: language. Polyglot nations are unsustainable. Experience in educational institutions alone shows this. Attempting to fund and run schools with multiple language groups feeds resentment and hate. It’s true for all public institutions. The only real answer is separation, that is, universal secession by smaller groups against larger groups. If national feeling feeds this, it is a friend of liberty.

What is the liberal attitude toward nationalism, in Mises’s view? The true liberal rejects dynastic control of lands because it “rejects the princes’ greed for lands and chaffering in lands.” Further, it embraces the right of a people to determine their own fate: self-determination, in the phrase of the time. However, Mises clarified that there is nothing inconsistent between love of nation and love of universal well being. Liberal nationalism is always directed against the tyrant. It always seeks peace between peoples: “The desire for national unity, too, is above all thoroughly peaceful.”

Now, keep in mind the year he was writing. It was 1919, before the rise of fascist ideology in Europe. The idea of forming states on the "national principle" alone was entirely new, and Mises saw it as the only real path to preventing a new world war from being borne out of allied imperialism and postwar German resentment. His vision was to let bygones be bygones, let people alone, permit any group or any part of a group to form its own nation (even down to the individual level, if that were possible), and move toward a world of free trade, free migration, and universal limits on power.

Mises’s Mind Changed

The Misesian path was not the one followed, obviously. Mises’s 1927 book on liberalism drops the endorsement of nationalism but retains the longing for self-determination. After the Second World War, following his migration to the US as a refugee, having spent six years being sheltered in Geneva, he was given the chance to revisit the question of nationalism. His new outlook appeared in 1944, in his book Omnipotent Government. Having witnessed at first hand the results of the nationalist experiment, Mises had completely changed his mind.

This book goes to great lengths to walk back his theory from 1919. In a world of statism, he recognises, nationalism is a philosophy of aggression. Whether based in religion, racism, or territorial expansionism, nationalism is a threat to liberty itself and the project of human cooperation. It leads to migration barriers, trade protectionism, violence against non-nationals, and finally war. He no longer believed that nationalism could be a friend of liberty. The reverse is true: “nationalism within our world of international division of labour is the inevitable outcome of etatism.”

What had made the difference? Life experience, for one. He watched his beloved Vienna be invaded by German armies. He saw the universities purged of intellectuals, particular those deemed Jewish and liberal. He saw Europe enveloped in despotism, war, and mass death, in the name of territorial expansion and domination by the master race. He watched with horror as the nationalist principle, the one he imagined might be a source of peace, become the basis of the bloodiest nightmare.

What mistake had he made? As he put it, his nationalist idea was rooted in an underlying philosophical presumption of liberalism, that is, models of public administration that do not interfere in people’s lives and property, do not seek war, do not restrict trade and migration, do not attempt to control racial and language demographics, and do not manipulate people’s desire for belongingness to shore up the power and status of a “great” leader. In other words, the real answer is liberty; nationalism not only contributes nothing to the cause but is easily weaponised by any state that expands beyond its proper role.

Renan’s Deconstruction

Having witnessed the horrors of what nationalism wrought in his home and throughout Europe, Mises sought out some theoretical basis for his new realisation. He found it in a 1882 writing by the French historian Ernst Renan: What Is a Nation? Mises was right: if another essay has done as good a job in dealing with the issue, I’m unaware of it. Renan wrote it while the age of monarchy was coming to a close, as the rise of democracy was occurring everywhere, but still before the Great War unleashed such territorial confusion. Ideologies like socialism, imperialism, and “scientific” racism were vying to replace old-world understandings of political community.

Renan observes that people frequently throw around the word nationalism without unpacking what precisely it means. He delineates five conventional theories of nationhood from history and practice:

1. Dynasty. This view believes that ruling-class lineage forms the foundation of nationhood. It’s about a history of initial conquest by one family or tribe over one people, its struggle to gain and maintain power and legitimacy, its marriages, wars, treaties, and alliances, along with a heroic legend. This is a solid description of European experience in feudal times, but it is not necessary for nationhood.
    The dynastic sense of what nationhood is has largely evaporated in the 20th century, and yet nationhood is still with us. Renan saw that the dynastic view of the nation is not a permanent feature of the concept but only incidental to a time and place, and wholly replaceable. “A nation can exist without a dynastic principle,” writes Renan, “and even those nations which have been formed by dynasties can be separated from them without therefore ceasing to exist.”

2. Religion. The belief that a nation needs to practice a single faith has been the basis of wars and killings since the beginning of recorded history. It seemed like nationhood couldn’t exist without it, which is why the Schism of the 11th century and the Reformation of the 16th century led to such conflict.
Then emerged a beautiful idea: let people believe what they want to believe, so long as they are not hurting anyone. The idea was tried and it worked, and thus was born the idea of religious liberty that finally severed the idea of national belongingness from religious identity. Even as late as the 19th century, American political interests claimed that the US could not be a nation while accepting Catholic, Jewish, and Buddhist immigration. Today we see these claims for what they are, politically illicit longings for conquest over the right of conscience.
In addition, what might appear at first to be a single religion actually has radically different expressions. Pennsylvania Amish and Texas Baptists share the same religious designation but have vastly different praxis, and the same is true of Irish vs. Vietnamese vs. Guatemalan versions of Catholicism. This is also true of every other religious faith, including Judaism, Islam, and Hinduism. 

3. Race. In the second half of the 19th century, there arose the new science of race, which purported to explain the evolution of all human societies through a deterministic reduction to biological characteristics. It was concluded that only race is firm and fixed and the basis of belongingness. Renan grants that in the most primitive societies, race is a large factor. But then comes other more developed aspects of the human experience: language, religion, art, music, and commercial engagement that break down racial divisions and create a new basis for community. Focussing on race alone is a revanchist longing in any civilised society.
    There is also a scientific problem too complex for simple resolution: no political community on earth can claim to be defined solely by racial identity because there is no pure race (Mises says exactly the same thing). This is why politics can never be reduced to ethnographic identity as a first principle. Racial ideology also trends toward the politics of violence: “No one has the right to go through the world fingering people's skulls, and taking them by the throat saying: 'You are of our blood; you belong to us!'” 

4. Language. As with the other claims of what constitutes nationality, the claim of language unity has a superficial plausibility. Polyglot communities living under a unity state face constant struggles over schooling, official business, and other issues of speech. They have the feeling of being two or several nations, thus tempting people to believe that language itself is the basis of nationhood. But this actually makes little sense: the US, New Zealand, and the UK are not a single nation because they hold the same language in common. Latin America and Spain, Portugal and Brazil, share the same language but not the same nation.
    There is also the issue that not even a single language is actually unified: infinite varieties of expression and dialect can cause ongoing confusion. How much, really, does the language of an urban native of New Jersey have to do with expressions used in rural Mississippi? “Language invites people to unite,” writes Renan, “but it does not force them to do so.” There is nothing mystically unifying about speaking the same language; language facilitates communication but does not forge a nation. Mises too embraces this view, thus reversing his position from 1919. 

5. Geography. Natural boundaries are another case of nation-making in the past which, as with all these other principles, actually has little to do with permanent features of what really makes a nation. Rivers and mountains can be convenient ways to draw borders but they do not permanently shape political communities. Geography can be easily overcome. It is malleable, as American history shows. The existence of geographically non-contiguous nations further refutes the notion.
    Americans speak of “sea to shining sea,” but how does that make sense of Alaska and Hawaii? Also in the US, enclaves of past national loyalty are a feature of city life: little Brazil, Chinatown, little Havana, and so on. Even further, to try to force unity based on geography alone is very dangerous. “I know of no doctrine which is more arbitrary or more fatal,” writes Renan, “for it allows one to justify any or every violence.”

All the above have some plausible claim to explaining national attachment, but none hold up under close scrutiny. In Renan’s view, nationhood is a spiritual principle, a reflection of the affections we feel toward some kind of political community – its ideals, its past, its achievements, and its future. Where your heart is, there is your nation, as Albert Jay Nock said. This is why so many of us, even outside the U.S. can still feel genuine feelings of joy and even belongingness during July 4th celebrations. We are celebrating something in common: a feeling we have that we share with others, regardless of religion, race, language, geography, and even ideology.

Renan: “Man is a slave neither of his race nor his language, nor of his religion, nor of the course of rivers nor of the direction taken by mountain chains. A large aggregate of men, healthy in mind and warm of heart, creates the kind of moral conscience which we call a nation.”

Mises was clearly taken with this view, and hence his change of heart and mind.

Orwell on Nationalism

Around the same time, the always-remarkable George Orwell presented his own Notes on Nationalism in 1945. It’s not as careful an essay as Renan’s but consider the context: fury and disgust at the rise of Nazism, nationalism, communism in Russia, and a ghastly war that wrecked so much of the world. Orwell had had it up to here with collectivism of all sorts.

His essay is in three parts. He first defines it: “the habit of assuming that human beings can be classified like insects and that whole blocks of millions or tens of millions of people can be confidently labelled ‘good’ or ‘bad.’” Secondly, “the habit of identifying oneself with a single nation or other unit, placing it beyond good and evil and recognising no other duty than that of advancing its interests.”

Notice that Orwell’s definition is not rooted in the territorial issue. His nationalism is more ideological. It’s the habitual and uncritical celebration of some group-based cause that one believes is specially blessed to solve all the world’s problems. In this sense, the typical Communist is a nationalist, looking the world over for revolutionary movements to cheer on, such as the political pilgrims who look at a place like Cuba and Venezuela and find not tyranny but emancipation. He even finds nationalism in the works of G.K. Chesterton who celebrated a “little England” but found virtue in expanding imperialism so long as it took on the Catholic brand (Orwell was especially disgusted at Chesterton’s defence of Mussolini).

Second, Orwell identified three nationalistic habits of mind:

First, obsession: “No nationalist ever thinks, talks, or writes about anything except the superiority of his own power unit. It is difficult if not impossible for any nationalist to conceal his allegiance. The smallest slur upon his own unit, or any implied praise of a rival organisation, fills him with uneasiness which he can relieve only by making some sharp retort.”
Second, instability. “The intensity with which they are held does not prevent nationalist loyalties from being transferable.” It’s a tribalist mindset and it can easily migrate. Thus were so many fascists recruited from the ranks of communists, and so many champions of the Pan-Germanism that bred Nazism came from the upper-class ranks of British society. In his view, nationalism is inherently unprincipled in this way.
Third, indifference to reality. “All nationalists have the power of not seeing resemblances between similar sets of facts…. Actions are held to be good or bad, not on their own merits, but according to who does them, and there is almost no kind of outrage — torture, the use of hostages, forced labour, mass deportations, imprisonment without trial, forgery, assassination, the bombing of civilians — which does not change its moral colour when it is committed by ‘our’ side.”

He elaborates this prescient point that pervades the left and right today.

Although endlessly brooding on power, victory, defeat, revenge, the nationalist is often somewhat uninterested in what happens in the real world. What he wants is to feel that his own unit is getting the better of some other unit, and he can more easily do this by scoring off an adversary than by examining the facts to see whether they support him. All nationalist controversy is at the debating-society level. It is always entirely inconclusive, since each contestant invariably believes himself to have won the victory. Some nationalists are not far from schizophrenia, living quite happily amid dreams of power and conquest which have no connection with the physical world.

Orwell discusses other manifestations of this mentality, such as forms of identity politics. All salvation comes from the white rice; all virtue is in the non-white races. All glory or evil resides in the Jewish people. Greatness/evil extends from one country. And we could go on with every list in the Identitarianism of our time: misogyny/feminism, disabled/abled, Christian/Islam, rich/poor, and so on.

The nationalist is forever counterposing diverse societies with homogenous ones, as if the latter thing even exists. The word homogeneity should not even apply in any literal sense to any two members of the human family. No two people are the same; even twins have minds of their own. The chase for a homogenous population will always and everywhere result in forcing people into a group not of their choosing.

Orwell writes: “The abiding purpose of every nationalist is to secure more power and more prestige, not for himself but for the nation or other unit in which he has chosen to sink his own individuality."

What’s most interesting about Orwell’s essay is that he takes a broadened view of the nationality question, to the point that it is no longer about territorial politics alone and instead touches on the psychological impact of political rule itself. (Sigmund Freud has long ago identified this as a pathology in his overlooked Group Psychology book.)

In this case, his analysis of nationalism applies not only to Nazism, not only to Communism, not only to Catholicism or any other religious or Identitarian movement you can name. It could, conceivably apply, for example to libertarianism itself. No one, no movement, is immune from the virus. Reflect on that point to perhaps explain a lot that has happened to the “liberty movement” over the last ten years.

Back to Hazony

Our Israeli professor friend Yoram Hazony is not unaware of Orwell’s writings, and addresses them directly. Still, he comes out on the other side, still arguing that nationalism is a friend of liberty. But what does he mean by liberty? He means democracy, stability, and high trust among society’s members such they that have warm affections for the national state and see it as an essential source for social order.

“The national state leverages these bonds of mutual loyalty,” he writes, “to get individuals to obey the laws, serve in the military and pay taxes, even when their own party or tribe is out of power and the government’s policies are not to their liking.”

This might be right – nationalism is certainly useful in manipulating people to intensify loyalties to the state – but is this necessarily the highest goal of society? Liberalism argued that the answer is no. The highest goal of society is realised not through loyalty to the state, but through freedom that leaves people alone in their person and property to find their own path to happiness.

A century ago, Hazony’s views might have been plausible. No more. Ludwig von Mises learned this lesson between his earliest and later writings. He lived through the experiment in controlled nationalism, and discovered the truth that it cannot be controlled. In fact, it can unleash literal hell as a propaganda device to disguise gross injustice and evil.

A nationalism that presents itself as a friend of liberty is one that must wilfully ignore that most bitter lessons of the last century, while eschewing the greatest lesson of all: that the only true guarantor of liberty is liberty itself.

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Jeffrey A. Tucker is Editorial Director for the American Institute for Economic Research. He is the author of many thousands of articles in the scholarly and popular press and eight books in 5 languages. He speaks widely on topics of economics, technology, social philosophy, and culture.

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In her 1977 lecture, Global Balkanisation, Ayn Rand examines the meaning of “ethnicity” and the consequences of “modern tribalism” in politics. Rand argues that the global trend toward political organisation based on race, language and religion bodes ill for the future of Western civilisation. She contrasts the disintegration inherent in modern tribalism with the unity displayed by societies that respect individual rights regardless of race or ancestry.
In this webinar and Q&A, Rand scholars Aaron Smith & Ben Bayer discuss highlights and major themes from this historic lecture, and the applicability of those themes to our world today: