Archive for July, 2010

Column on A Lopsided Warning

A Lopsided Warning

Tibor R. Machan

The president of the AAUP–American Association of University Professors–issued a lengthy declaration warning the membership against getting involved with BP, the giant oil company whose operations have gone awry in the Gulf of Mexico and whose management is suspected of numerous failures and malpractices that have lead to the disaster in the Gulf. Of course, this, like some other high visible corporate infelicities have provoked innumerable people, pundits, government officials, bureaucrats, and, of course, most of all the cheerleaders of extensive government regulation of business, to chime in with a chorus of condemnation not only of BP (way before any serious scrutiny of its conduct has been carried out) but of big business itself.

Gary Nelson, AAUP’s president, joined in with his lengthy dissertation imploring academicians–professors and researchers alike–to refuse any job offers from BP which contained contractual provisions that would keep research and scholarship about the GUlf disaster secret or the property of BP. Sounding the mantra of threatening academic freedom–which, strictly speaking, such contracts do not threaten at all–President Nelson paints BP in the worst possible light, which, incidentally, may very well turn out to be justified (although it is at this point too early to tell and anyone with the slightest respect for due process of law, or even morality, would probably best remain silent).

But that is not what is really the most disturbing part of what Craig Nelson has done here. The worst thing is the lopsided nature of his warning. The greatest and bona fide threat to academic freedom does not come from BP and other big corporations. It comes from governments that are knee deep involved in American higher education and university scientific and technological research across the country. The sums of moneys taxpayers are coerced to contribute to universities is staggering. All those costly experiments conducted by the astro- or high energy, particle physicists across the land are funded by the taxpayers, other than those that some big private businesses support voluntarily (!).

When and if Professor Nelson identifies the source of troubles in higher education as stemming from massive government involvement, including funding and regulation, his lamentations about big business may acquire some measure of credibility but before that he has no basis for all his righteous cautionary words about academics getting into bed with big corporations. The threat from government to academic freedom, scholarly impartiality, lack of bias and partisanship is far greater than that coming from associating with big business–one can always, even if with difficulty, withdraw from businesses and go to some that behave better, but there is but one (or a few different levels of) government and usually equipped with guns to get its tasks achieved.

Nor is there any justification in treating government officials as if they were all knowing and virtuous, while corporate managers are regarded as villains. They aren’t public servants any more than are the rest of us. The idea of their having special virtues that qualify them to regiment around professionals of all sorts, including people in business, is misguided or an out and out ruse. Or maybe it’s just rank prejudice, especially in light of the source of most of the world’s deadly wars having been and still being waged by governments. BP has its serious faults but the federal government of nearly every country is far worse.

The first task for academicians is to achieve genuine independence, which must include independence of government funding and its cherry picking of where support will be given and where it will be withheld. Once that theme is central to the message of AAUP president Nelson and others like him, they will have earned the warrant to engage in chiding professors who may chose to join big businesses in the capacity of apologists.

But we should not hold our breaths waiting for this. Consistency and integrity are far from the list of virtues of the likes of Professor Nelson, at least when it comes to this topic.

Essay on Hungary’s Malaise

Hungary’s Malaise:
(Introduction to A Brief On Business Ethics, Hungarian Edition)

by Tibor R. Machan

Shortly after Hungary set off the fall of Soviet-style socialism in 1989, when that country’s rulers allowed visitors from what then was East Germany to leave without any hindrance for West Germany, my mother, who had lived there for all of her life before being allowed to leave in 1975, made some interesting predictions. The decision by the Hungarian rulers was the first step toward the dismantling of the Soviet Empire. But my mother thought it wouldn’t necessarily lead to panacea.
Her idea came back to me during the last few days when Prime Minister Ference Gyurcsany, identified by some as “the golden boy” of Hungary’s Socialist Party, got himself into serious trouble with many Hungarians for having admitted, in a leaked closed-door party conference speech, that during his two years term as Prime Minister and the Socialist (post-communist) Party leader for the 2006 election which he and his party won, he was lying about the country’s economy “morning, evening and night.” Given that this was said in a recording that captured his own voice, Gyurcsany could not and never did deny that he made that statement.

What my mother said to me back after the fall of the Soviet-style socialists was that unless all those who were part of the old, communist regime were put in jail, the country would eventually be retaken by the former bosses because there was no group of classical liberal leaders ready to lead the country away from its dismal socialist past. She was confident that without such a group of new leaders, with genuinely new ideas, Hungary would slowly return to its old socialist ways.
What my mother said seemed to me to echo the more scholarly reflections of Professor Janos Kornai, in his book Road to the Free Market Economy: Shifting from a Socialist System the Example of Hungary (Viking, 1990).

What Kornai focused on, in particular, is the temptation faced by the newly reconstituted but unreconstructed socialists — who were welcomed by the post-Soviet regime to take part in Hungary’s political affairs — to produce a nominal free market system that is, in reality, merely a bit different from the old socialist economy. In short, they would attempt to forge a powerful welfare state, promising to provide all the impossible perks of the old regime, only without the accompanying totalitarian politics. Kornai warned that this is going to be impossible and will simply lead to economic collapse. As the saying goes, you cannot squeeze blood out of a turnip. A broken economy like that produced under Soviet-style socialism simply cannot sustain the burdens of a welfare state. Why?
Because where there is no wealth, one simply cannot steal much. While Kornai was too polite to put it just this way, the plain fact is that a welfare state depends on there being a sufficient number of wealthy enough people from whom the government can steal so as to provide the perks the politicians are always tempted to promise to the voters.

Hungarians are arguably experiencing the consequences of not heeding Kornai’s advice, and of failing to come up with a genuine free market political leadership. Instead, for more than two decades, the country has been trying to make do with a hodge-podge post-Soviet regime that fails to actually give up the socialist dream. Most recently a new tax was voted in on banks, never mind that taxes are, as in most places, choking the country already and the credit crunch is killing economic growth.

While a country such as the United States of America can get away with such a hodge-podge system, since its basic infrastructure has for many decades provided reasonably firm protection to basic classical liberal institutions — e.g., the right to private property, freedom of contract, civil liberties, etc. — in Hungary there is no comparable history to fall back upon. So once the barrel has been scraped, there is nothing more left to steal. There are no rich companies, rich individuals, rich investors and so on who could be conscripted to come up with the funds to sustain the welfare state.

Given this reality, what else can a socialist do but lie, lie and lie some more? And once the citizens of the country discover this — and that’s one benefit of having left the Soviet-style system behind, namely, considerable openness about what politicians are doing — the regime will meet with plenty of opposition. And this is why the PM was urged to resign. He was reluctant to do so but it is difficult to see where he could go after this. The jig is up, as the saying goes.

There is no socialist miracle. Unless the country generates some solid non-socialist leadership and these will persuade the citizenry to have some patience while the economy recovers, prospects for peace and prosperity are dim.

Column on Obama’s Professor Yoo

Obama’s Professor Yoo

Tibor R. Machan

Don’t believe it for a moment. The American Left, as a whole, does not support civil liberties. All that protestation of about Bush and Cheney’s allegedly unconstitutional expansion of presidential powers was just a bunch of empty hand-waiving. The New York Times has made it abundantly clear now that the recent protests by the Left against Professor John Yoo’s efforts to help former president George W. Bush to garner extensive presidential powers had nothing to do with opposing expanding governmental power.

When Mr. Bush and his team wanted the power to deploy water-boarding techniques against suspected terrorists or those who could provide information about such people, those on the American Left were outraged. How dare this law professor offer advice to the Bush White House about what legal reasoning to use so as to make a convincing case for the powers the president and company believed they needed so as to fight the war on terrorism effectively and possibly successfully? Of course, Bush & Co. may very well have been grasping for what is constitutionally impossible but never mind that. If a legal whizz could make the case for such powers, so be it. Lawyers are supposed to pull rabbits out of the hat for their clients, never mind truth, logic and the U. S. Constitution.

Now it is evident that as so often before, the American Left was quite hypocritical about its outrage at the shenanigans of Bush & Co. There was nothing about this Republican Administration’s policies that the Obama Administration could consistently disapprove of. As The New York Times made clear in its Tuesday, July 20, 2010, editorial in support of Elena Kagan’s nomination to the Supreme Court, Professor Kagan did exactly what Professor Yoo was being accused of, namely, give advice to various parties in support of dubiously expanding the powers of the federal government.

In particular, Professor Kagan had urged that several proposed pieces of legislation that would help the government expand its powers over the American people be tied cleverly to the interstate commerce clause of the U. S. Constitution even though the substance of the position being advocate

had nothing at all to do with interstate commerce. But, as Professor Kagan made clear, it could be made to look like it did and therefore Congress could gain the power it sought so as to acquire the legal power to override the liberties of citizens who did not want to be regulated, ordered about, forced to comply with Congress’ wishes.

The New York Times, of course, hailed Professor Kagan’s efforts to rationalize Congress’ powers under the interstate commerce clause as a case of helping to promote various welfare statist and social democratic government measures, ones that a strict application of the philosophy of limited government, the sort the American Founders advocated, would not justify. Indeed, there is even a credible argument to the effect that the interstate commerce clause’s use of the term “regulate” had nothing to do with the kind of meddling in the free market that the American Left supports. (Instead, the Constitution meant only to promote the regularization of commerce between the new states of a united country!)

But however one ultimately comes down on that issue, one thing is for sure. The Obama Administration and its cheerleaders in the legal profession do not have anything against increasing the powers of government. That’s not what these folks dislike about efforts to justify water boarding. It is only that this particular power of government might be used for purposes, such as catching terrorists, they do not approve of. If the power is used to regiment people’s economic affairs, go for it!

Column: Recycling a Beauty

Recycling A Beauty

Tibor R. Machan

My friend and occasional colleague–when we have both worked for the Institute for Economic Studies Europe now and then during summers over the last couple of decades–Professor Donald J. Boudreaux of George Mason University has a wonderful knack for zeroing in on the nonsense that so often surrounds us in certain very prominent forums the editors of which appear to have no critical abilities at all, no clue as to whether the kind of stuff they publish manages to be utter balderdash. He is a dedicate scout searching out such nonsense and often publishes the letters he sends to newspapers, magazines and other media at the blog he and some friends of his operate, Cafe Hayek.

Just today he sent out one of these that is a great winner in my book, no question about it. It echoes something I had pointed out about ten years ago to a young friend of mine who was pining to me about how the Middle Ages had been so much more meaningful and noble to live in than our own times. (I had had enough of this pining after a while so I pointed out to my friend that he, as a father of then four–now six–children might rethink his adoration of those days past by considering that probably but one of those four would manage to survive to the ripe old age of 20 back in those glorious times!) So I have asked Professor Boudreaux whether I might reproduce in my own column his absolutely spot on comment on a similar young person’s mindless ruminations discussed in The Washington Post. Here it is and please take it to heart.

The only thing I would like to add is that anyone who would like to delve into more of such sensible points made against the innumerable know-nothings of our age should check out the works of the late Julian Simon as well as the recently published book by Matt Ridley, Rational Optimist. Perhaps these will manage to be the antidotes to the kind of baffling thinking produced by the likes of Mr. Kelley (below) and by more prominent public philosophers such as Jeremy Rifkin!

Of course our era has its problems but these folks are really bonkers with their pessimism. What’s more, they aren’t upset with some of the real horrors of our time, such as the tyrannies and wars and oppression that go on in parts of the globe but with the good stuff, like our having enough to eat and efficient transportation! Nor does one hear from them much about Nazism and Communism, the really horrible systems of the modern age but instead they keep advancing lamentations about modernity and the free market system, precisely what have been the liberating features of our time.

Editor, Washington Post
1150 15th St., NW
Washington, DC 20071

Dear Editor:

Benjamin Kelley says that his art “represents the dehumanization of modern society” (“An artistic body of work’s bone of contention,” July 16). I’d like to ask him which aspects of pre-modern society he believes to have been most humane. Was it a life-expectancy of about 30 years? How about mass illiteracy? Maybe Mr. Kelley longs for the odors, lice, and scabs that regularly adorned human bodies that seldom bathed and that slept on dirt or straw?

Possibly Mr. Kelley regrets that the homicide rate in modern society is far lower – as much as ten-times lower – than in pre-modern societies? Perchance he laments modernity’s liberation of women from the oppressive dominance of men? Maybe he finds fault with modern humans’ greater skepticism of tales of witches and sentient volcanoes? Or perhaps Mr. Kelley is upset simply because modernity has eradicated slavery?

Being only 26 years old in modern society, Mr. Kelley has many decades left to reject his fashionable romantic nonsense about a past Golden Age. Were he born just a few generations earlier, however, not only would he have been unable to earn a living as an artist, his own stint in humanity would have been much shorter.

Donald J. Boudreaux
Professor of Economics
George Mason University
Fairfax, VA 22030

Column on Shutting it Down for the State

Shutting it all down for the State!

Tibor R. Machan

I travel about quite a lot. I have crossed the USA back and forth about 25 times by car and have also done a good deal of driving in Europe–France, Italy, Switzerland, Germany and so on.

Some time ago I noticed something that one might wish to explore more systematically than just relying on one’s personal observation. This is that in much of Europe the public authorities are who matter most, with the public standing in the back, waiting its turn. Twenty years ago I wrote about this in a column and it all got reconfirmed for me these last couple of days as I was making an 800 kilometer trip on the German Autobahn.

I am talking about how whenever some mishap happens on the road, the authorities shut it all down, even if it is just a crate of apples that spilled. I was driving north on A 2 and suddenly everything came to a screeching halt. Nothing moved. Like a huge parking lot. Everyone stood there, with cars idling, using up precious fuel in scorching heat, air conditioning blasting in every car that had it. To be sure, there were radio announcements telling us that matters have gone awry but this didn’t help much, especially if your German wasn’t it top shape just then.

There were two or three of these interruptions within a span of about five hundred kilometers, one lasting an entire hour. And when it was over and we drove past the “accident,” it looked like a small van turned over with some boxes spilled out on the road, no ambulance in sight, nada. At the next rest stop where everyone had to take advantage of the facilities I asked what exactly was the big deal and was informed that the Autobahn people just stop all traffic no matter the severity of the mishap. Sure, they could have pushed the crates that spilled out of the van over to the side of the road and made it possible for traffic to proceed but, no, that would not do. Let’s just shut it all down.

I am paranoid enough about public officials to imagine right away that they just don’t give a rat’s ass about inconveniencing of the driving public. Let them wait, who cares. They are just subjects who must submit the the public authorities, are they not?

Come to think of if, when I originally wrote about it I noticed a difference between how the public authorities handled the situation in Europe versus how they did in the USA but the difference appears to me to have disappeared. Now the same is happening all over the USA. A problem arises and what seems to matter is what is convenient for the authorities, never mind the driving public. Maybe I am too suspicious but it looks to me that America is becoming like Europe not only in its embrace of the welfare state, the entitlement mentality, but also in how the people who supposedly work for us as civil servants are becoming the wielders of power, never mind public service!

All this brings to mind for me that for centuries and centuries on end the bulk of the population of every country were deemed to be subjects, not citizens, not sovereign individuals. They had no rights only some privileges granted them by the state. Nothing was done as a matter of what they had coming to them from the public authorities, only as a matter of what these authorities decided they should be granted as a gift.

We in America now have a head of state who actually appears to accept this reactionary philosophy, judging by his eager embrace of the judicial philosophy of his former colleague from the University of Chicago Law School, now Harvard law professor Cass Sunstein. This theorist believes we do not have natural rights, rights prior to the development of a legal system, but the legal system establishes our rights–meaning he and his pals do. Not a great development, this Europeanization of America.