Posts tagged coercion
SS: Ponzi Scheme Isn’t the Problem
Tibor R. Machan
Everyone by now knows what a Ponzi Scheme amounts to. We all became familiar with it when Bernie Madoff was caught using it to amass a fortune at the expense of clients who were unaware that his plan to put away money for them amounted to such a scheme.
The issue in the case of Madoff wasn’t actually so much the scheme but the lack of full disclosure about it. Ponzi schemes are legion around the world and people knowingly take part in them. Most insurance companies use them, collecting funds from new clients and paying old ones in part from the new cash. Retirement systems make use of the scheme as well. Those who have paid in are often getting the funds the new clients pay now. So with the social security system.
But the social security system would be no problem if it were voluntary and those who are part of it knew from the start the risks involved. Fractional reserve banking is like that too: when people deposit their money in banks the money isn’t all left in vaults until they withdraw it but much of it is used to give loans and make investments. And clients of the bank know this but figure the bankers are skilled at what they are doing and will not use the funds recklessly, irresponsibly. But they do not expect all costumers to suddenly withdraw their funds; the banks could handle that. But since it is common knowledge, nothing is amiss in such arrangements.
So that’s not what’s wrong with the social security system. The problem is that once you work, you are forced to be part of them system (with only some exceptions, such as when the state you work in has its own similar scheme in play). This, just like the income tax, is a form of extortion. Just like what happens when organized criminals force merchants to cough up money for them or they will burn down the business! Sending working people to jail or imposing immense fines on them unless they pay their taxes, social security or otherwise, is just like that. One has no choice if one wants to make a living: “Pay the government or have no job!”
When Republican candidate Rick Perry called the social security system a Ponzi scheme, a bunch of his critics, even fellow Republicans, expressed shock. Their ire, however, is misplaced. But the Republicans have no more leverage with pointing out that social security is mandatory than would the Democrats. Republicans and Democrats–indeed all political parties other than the Libertarians–favor extorting funds from the citizenry, only for different purposes. So what they argue about isn’t really all that important. Ponzi schemes are everywhere. What is much more problematic is when everywhere some people force others to carry on in certain ways, take part in various schemes, whether they chose to or not.
If there is a feature of the modern world that is basically different from ancient systems is that it is less enamored by outright force–slavery, serfdom, torture, etc. Such things are these days more widely seen as uncivilized, barbaric. And if a political system or public policy embodies coercive force that some use on others, it is now more suspect than it used to be in olden days. Not everywhere, of course, and not even in so called Western democracies. After all, democracies can contain a great deal of coercion and do everywhere you look. Still, the coercion in democracies is less brutal than in systems with top down dictatorial rulers such as the ones in the Middle East.
What needs to be discussed about social security in not the Ponzi scheme element but that is forcibly imposed on all working people in the country, never mind whether they want it or not. It would be quite enlightening if this aspect of social security were debated. That would bring up a central feature of most governments, namely, their coercive nature. That is what the American Founders and Framers were concerned about and while they didn’t reject all coercive policies –e.g., slavery, taxation–they were very hesitant about them.
Peddling the Corruption of Liberty
Tibor R. Machan
Ever since the idea of individual liberty has achieved some measure of credibility over the world, those who would be unseated by its limited triumph had to find some way to discredit it or trump it somehow. One way was to re-christen servitude, to make it appear like an even more important kind of liberty than what individual liberty, properly understood, amounts to.
When a human being is free in the most important, political sense, he or she is sovereign. This means that one governs one’s own life—others must refrain from intruding on this life, plain and simple. That life may be fortunate or not, rich or not, beautiful or not, and many other things or not, but what matters is that that life is no one else’s to mess with. One gets to run it, no one else does.
Now this is a very uncomfortable idea for all those folks who see all kinds of benefits from running other people’s lives. But they cannot champion this now in so many words, what with individual liberty having gained solid enough standing, so the only way to remedy matters for them is to claim that their oppression brings even greater freedom to people than the respect and protection of individual liberty.
So, we have the kind of “freedoms” propounded by Franklin D. Roosevelt, the freedoms now dubbed “positive.” These freedoms do not get rid of those who would use you, interfere with you, invade your life, rob, kill, or assault you but promise, to the contrary, to take good care of you without your having to do much by invading others, by violating their individual liberties. These are the entitlement rights offered up by proponents of the welfare state, all those who claim that government is best when it is generous, when it becomes the Nanny State—meaning, when it enslaves Peter to serve Paul.
I am not sure about what exactly motivates this ruse—some of it is surely the thirst for power. When you want to enslave people, promise them a special kind of liberty. Castro managed to win over millions of Cubans this way, as did other Marxists in Eastern Europe and in Latin America.
Maybe a few folks actually honestly believed that this kind of political alternative is best for us all, but it is difficult to imagine what would persuade them of such a fraudulent notion. Giving people this positive freedom must always involve depriving other people of their individual liberty, their “negative” freedom, which is to say, their sovereignty and their freedom from having others interfere with their lives, from depriving them of their resources and labor and regulating them to the hilt.
Now, there is little that can be done about this in the short run—when people put their minds to such deceptions, the only ultimate defense is clear thinking and vigilance, which is unfortunately always in short supply and needs to be slowly cultivated. Too many people are tempted by the promise of effortless living, of getting all their problems solved at the point of a gun turned on others who will be coerced to come up with the solutions. This is such a sweet notion to those who are lazy, who feel left out, or who believe that they are entitled to everything all those who are better off already have going for them, so the power-hungry have a good marketing ploy here. Envy, maybe, or the bogus political ideologies promoted by those who just must step in to govern the world as they see fit—as I say, I am not sure what kind of mental acrobatics manages to allow people to live with themselves in peace who perpetrate such fraud.
I do know of one prominent one, namely, that those who want to wield control over others believe they are on the side of goodness, virtue and justice. Making people “good” is their goal, they proclaim. Yet this just cannot be since people are only good, morally and ethically, if they choose to be. Otherwise they at most simply behave well, like robots or puppets.
Despite the fact that there is little one can do in response, other than to keep spelling out just how misguided it all is, perhaps now and then institutional barriers can also be built. Yet, since they too depend upon ideas, ideas that are so easily corrupted, the only real answer is the old one about eternal vigilance. I say, it’s worth it, so let’s go for it.
Revisiting and Expanding the Laffer Curve
Tibor R. Machan
The Laffer curve is about how much imposition or other types of trouble people are willing to tolerate from their fellows. Arthur Laffer, a professor at the University of Southern California, is supposed to have drawn a bell shaped graph on a napkin once to show that up to the peak point of it people are likely to put up with the burden of taxation. The peak isn’t the same for everyone, but everyone does have such a peak.
In particular, then, the Laffer Curve concerns taxation, a form of extortion, which government uses to obtain funds to operate its undertakings. Reminiscent of how organized crime groups, such as the Mafia, operate, the government threatens heavy fines and jail so those being threatened hand over funds. Since, however, many governments, unlike the Mafia, can be voted out of office, the severity of the extortion has to be gauged with the possibility of eventual electoral resistance in mind. This is no easy task and can often go awry. Yet in most countries tax revolts are relatively rare since few people wish to risk losing their forms of life just so as to retaliate against the powerful forces of the state. This, again, is similar to Mafia type extortions in which the victim is given some benefits in order to be placated—e.g., protection from vandalism (the bulk of it initiated by the gangsters themselves).
Now the Laffer Curve is extendable into much more than the sphere of taxation-extortion. Any sort of government intrusion is subject to its insight. Censorship comes to mind—a certain amount of it will not be widely resisted. Government regulation, all of it a violation of the prohibition of prior restraint—is also subject to it since it is taken to be more trouble at times to resist than to comply with it. Indeed, statism as such is subject to the Laffer Curve analysis—in most societies it is not significantly enough resisted for it to subside, let alone disappear. People subjected to statist measures of any sort simply will not mount effective resistance because to do so may involve greater losses than gains and they are, after all, often able to circumvent it reasonably successfully by using their own intelligence or hiring expert help in the form of specialist in various branches of intrusive law.
Finally, the Laffer Curve is useful, also, to explain why there is not enough political resistance to statism and why only a small percentage of the population bothers to mount any, especially in advanced, developed countries where people live quite well, and where mounting resistance is quite costly, relatively speaking—that is, the possibility of success is small while the cost of the revolt is considerable. In undeveloped countries the situation is different, which helps explain why so often it is in such countries that we see rebellion and revolt against prevailing authorities and why there is frequent regime change in many of them. Put bluntly, the bulk of the population has little to lose from rising up against the state. That is not so in most developed countries.
The small percentage of citizens who will insist on making an issue out of nearly any measure of statism in developed countries will not manage to achieve regime change, of course, but it will keep the idea of it alive. Yet this itself can contribute to the ineffectuality of such marginal efforts, since the rest of the population may perceive the small resistance as sufficient and proceed without given it any aid or even much attention.
Is there a remedy or is this normal? In a sense it is normal—most people will put up with some trouble from others. They will accept a certain amount of intrusive noise from neighbors, being bumped on the sidewalk as they hurry to some destination, even some fender bender type auto accidents, let alone insults and humiliation. Minor thefts or assaults are rarely reported to the authorities.
However, what is not normal is becoming habituated to such tolerance for invasiveness from others. Most of us fear the consequences of such habituation—just as we fear being habituated to anything that harms us in the long run.
If it becomes evident enough, via education or the example from other regions of the world, that statism even in small increments has bad overall consequences, that things could turn out measurably better without it, the peak of the Laffer Curve may become more easily reached for the bulk of the people and the level of tolerance of statism could diminish considerably.
Ethics and Responsibility*
Tibor R. Machan
I want to discuss a very important element of ethics in almost any school of moral philosophy. Ethics is probably one of those fields in philosophy that has many, many competing schools. The basic task of ethics is to answer the question, “How should I act?” “What standards apply to me as I conduct my life?” “What are the fundamental principles that I should follow?” Those are pretty much equivalent questions but the answers are extremely complicated and multi-faceted. There are a lot of very different answers that have been proposed and these are the schools of ethics most people are familiar with. Almost every major philosopher throughout the history of philosophy, east and west, has advanced an ethical theory; a theory about how human beings should conduct themselves. This is something most philosophers do. Some even contend that ethics is but a branch of politics which is prior to it, although the opposite is how most view it today. They contend that among the ancient Greeks, like Aristotle, politics is prior to ethics, although reading Aristotle’s Nicomachean Ethics doesn’t consistently support this idea.
There are, however, also philosophers and other thinkers who deny that there is any such discipline as ethics. In fact many philosophers, as well as many social and natural scientists, contend that the entire field of ethics is bogus. It’s akin to astrology, something most regard as a bogus field, and a lot of social and natural scientists believe this about ethics. There is no valid idea that includes the concept “ought.” Ought is an incoherent concept. That’s because judgments including it cannot be shown to be true (or false). Also those who are skeptical about ethics deny that we have any choice about how we conduct ourselves, that we can make free decisions as to what we will do. Thus for two reasons for many ethics is a non-starter (like astrology).
But the bulk of philosophers (and I would say the bulk of human beings) have a concern with ethics and take it seriously. They don’t dismiss it as bogus but tend to think there is a right answer to the question, “How should I act?” or “How should I conduct my life?” or “What principles should guide me?” whenever it is raised.
One reason that ethics arises for us (not an uncontroversial reason but a reason that makes sense) is that we don’t have the requisite set of instincts–or “hard wiring”–prompting us to behave as we need to in order to survive and flourish in our lives. If you look at almost any other animal (and I’m not going to get into the big debate as to whether there are some borderline cases), almost all have these instincts, these hard-wirings, so that, for example, in the winter they fly south and they don’t have to have a committee or go to graduate school to learn about it. Human beings, in contrast, have to figure out what they should do, how they should conduct themselves, whether to do this or that. When one’s a parent, one needs to make a choice too be a good one but might not do so and simply muddle through it all. When you’re a professor you have to consider how to be a competent one, a decent teacher and scholar, etc. And so on and so forth throughout the entire landscape of human activities. The issue of what are the right things to do and what are the wrong things to avoid doing always faces us. That is what editorials are about, that is what most famous plays and novels are about. Almost anything interesting in life tends to revolve around ethics.
Now I’m not going to try to sketch an ethical theory here but discuss the connection between ethics and human responsibility.
Responsibility is a very broad concept and one sense of it underlies any school of ethics; whether one considers utilitarianism, altruism, egoism, Aristotelian or Kantian ethics sound, all involve a person’s responsibility for conduct. However one answers the question, “How ought I conduct myself?” the issue of responsibility is central and unavoidable. But what does it mean? What is being meant here by using the concept of responsibility?
There are many uses of the idea “responsibility”. Sometimes crop failures are due to the weather so the weather is taken to be responsible for them. Buildings collapse because of earthquakes so earthquakes are responsible for the carnage. In this sense responsibility means that these factors are the causes of such happenings. What happens is because of this or that event that is responsible.
There is a relationship between this use of the term “responsible” and the one that bears on ethics but it is a controversial relationship because ethics in its customary sense–namely pertaining to how human beings ought to act–assumes one of the most controversial contentions in philosophy, psychology, and almost the entire list of the human sciences. That is that human beings have something usually called free will, that they can act one way or the other and it is up to them how they will act. What they choose to do is not because of god, the weather, their genes, their DNA or anything else. They, the actors or agents, are the ones who are responsible.
Those of us with children are familiar with this without having to become too philosophical. Children quite early in their lives try to avoid being held responsible for bad things and prefer being credited for good deeds. This is a very early idea in one’s life–as well as in the history of philosophy. It is one of the earliest ideas of ethics in any region of the world. Wherever people talk or write about ethics, it is generally assumed that they have to do the right thing of their own free will. This is very common with many thinkers, especially those writing novels, editorials, Op Ed columns and the like. Whenever there is exhortation about what people should and should not be doing, the idea surfaces immediately for blame and praise are accorded in the case of most significant human activities.
Some are unsure in their views on the matter but most have, to the extent that they have a normative framework, views about how people ought to act, whether individually or institutionally. In all such cases there is much concern about responsibility. And that is quite natural. One need not be an academic philosopher to appreciate that when human beings worry about their lives they worry about something over which they believe they have a say. They have some effective influence over how they will act. They are what is often referred to in philosophy as the causal agent of their actions. And if there is anything to that, then indeed a central element of human life is one’s personal responsibility to do the right thing so that if one fails to do the right thing, one is usually held responsible for it. Criminal law obviously banks on this notion and ethics and morality do as well.
The difference between ethics and morality isn’t germane here–”ethics” was the earlier term used by the ancient Greeks and it usually meant living right, whether it has to do with one’s personal life or the lives of intimates over whom one has influence or strangers. Morality mostly has to do with coordinating properly our actions with the actions of others. Morality is the social dimension of ethics. Though this may not seem like very significant, the distinction has had a major influence on the evolution of ethics, at least Western thought. (It is often maintained now that how one ought to act is only important when it effects other people, not oneself.)
After the highly influential work of Thomas Hobbes, there has been more emphasis on morality, on what you might call social ethics instead of personal ethics such as that which we find in Socrates, Plato, and Aristotle. But this is not a major issue here. Both ethics and morality concern themselves with right as distinguished from wrong conduct.
A very recent (in the sweep of human history) thinker on this matter was Immanuel Kant who coined a motto that many philosophers invoke when they connect ethics and freedom. The motto is, “Ought implies can.” It just means that if one ought to do or abstain from doing something, it has to be what one is capable of doing. It is nonsense to say someone ought to jump 30 feet into the air unassisted because that’s impossible. One couldn’t very well have a moral responsibility to do the impossible.
So “ought implies can” refers to the fact that one has to be able to choose between doing something or not doing it in order to have the ethical or moral responsibility to do it. And there is another element to this as well. Not only must one be free to do the right thing and not be compelled one way or another–not just that it is one who is doing it–but it’s must also be knowable. In other words, what is the right thing to do has to be correctly answerable because if there is no possible correct answer to the question, “what is the right thing to do?” or “what ought I to do?” then one can’t do it. So if “ought” does imply “can,” then it also requires that there be some standards of proper conduct, of proper behavior.
The issue here isn’t which of the many ethical systems that have been proposed, advocated, defended, and championed throughout the history of ethics is right. Instead here it is these elements that are crucial: People have to be free and there has to be some standard by which their conduct is to be evaluated. Otherwise there is no ethics. Ethics then really becomes a bogus field if you cannot be free to choose the right course and if you cannot determine what the right course is. And needless to stress, all these are extremely controversial issues in the field of moral philosophy in ethics, especially in a field that precedes ethics, called metaethics.
Metaethics simply means, how do we get to know about ethics? How do we figure out ethics? Metaethics is the considerations that come before we get to the issue of how we should conduct ourselves. There are considerations that need to be handled before that and one of them is, “Are you free to choose?” The other one is, “Is there a way to determine what is the right thing to do?” These are metaethical issues. The ethical issues are, “What should I do?” or “What should I not do?” But “How do I know it?” is what’s called a metaethical issue. If one pays close attention to this, one will already have an inkling how this all relates to political philosophy, even political theory. Clearly if one is responsible for one’s conduct and others interfere with and prevent one from acting feely, one’s ethical life is squelched. If somebody forces a person to do something, one is not going to be able to take any credit for or be blamed for it. Which is well recognized in criminal law and it is also in morality. People often defend themselves against charges of malpractice or misconduct in court by trying to make out the case that they could not help themselves, that they did not have the freedom to act, that they were not the ones that were responsible for the behavior that is deemed criminal. It was something else. Maybe it was drugs, or “the devil made me do it.”
This idea of the intimate connection between freedom and ethics is ancient, hardly anybody denies it. There are some, however, who are deniers. These are people who in my view have abandoned ethics altogether but still like to keep the word around. They are people who believe that although you don’t have the freedom to choose, or there really isn’t any way to determine there is right conduct versus wrong conduct, nonetheless there is some vague thing called ethics having to do with what the public expects of one, or how one may be enticed to act in certain ways that are desirable from the social point of view, or some other thing; these aren’t what ethics is about, however, only what may be associated with ethics. Such matters pertain to what is to be encouraged amongst each other that’s desirable, but not with choosing to do the right thing, which is the province of ethics proper.
Doing the right thing is the task of a sovereign individual, someone who has the capacity to choose and may exercise that capacity well or badly, That is where this issue of responsibility pertains to human beings squarely and in a society in which the government regiments the population (even just a little sometimes is enough) what takes place as a result is demoralization, the removal of moral choice from people’s concerns. IN such a regimented society people’s moral lives are undercut and undermined. They no longer have the responsibility to act properly because the law has taken it upon itself to coerce them into doing whatever governments considers to be the right thing to do and to abstain from what government regards wrongful conduct. But if one is coerced to do the morally right thing, one is not actually doing it. One then has become a mere puppet.
One thing one tells one’s children after they have reached a certain age is that now they must take responsibility for their own actions, whereas before that one is perfectly willing to give them very close instructions as to what they should do, maybe even force them to do the right thing (but perhaps only with an eye to their growing up to do it on their own, rather than being prodded into doing it).
Some aspects of the current political situation are incompatible with the intimate connection between ethical responsibility and political freedom. Most generally put, it is where other people treat one as though they were one’s parents. A recent inventions of President Obama’s close associated and an architect of forthcoming government regulations is Professor Cass Sunstein of the Harvard Law School. He and some others have forged the concept of “libertarian paternalism” or “governmental nudging,” both oxymorons by any reasonable account. What Sunstein and Co. have in mind is a situation in which people are manipulated into doing what the government considers the right thing for them to do, akin to how when one attends a party at someone’s house who want one to take off one’s shoes at the entrance. They are likely to leave some kind of clue at the entrance, such as a bunch of shoes by those who live at the house, suggesting that it’s time to take off one’s shoes, without having to come up and ordering one to take off one’s shoes. That would be libertarian paternalism or nudging.
Sunstein co-wrote a book with Richard H. Thaler, titled Nudge: Improving Decisions About Health, Wealth, and Happiness (Yale 2008) that instead of promoting out and out tyrannical government promotes a subtle and circumspect but still intrusive public policy by means of which citizens will be manipulated so as to bring about the government’s goals in such a way that one won’t really notice this. Such would be a not very disguised Machiavellianism for the 21st century.
Once again, the notion that you ought to be free to conduct your own affairs is trumped with the idea that we need to be ruled, even if only with a nudge.
There are many other areas where this kind of interference, pushing, and paternalism take place. It is almost impossible to list them in the current political climate because virtually everything that is done in Washington and in many other centers of legal power amounts to interference in people’s liberties. And, of course, there is always some excuse, some attempt to achieve something good or worthwhile. Often complaining about is met with the response that, well, it is done all over the civilized world, such as France, Germany, England, and Scandinavia.
Yet what is missed in this reply is that the American political system began by rejecting the approaches to public affairs deployed in most places around the globe precisely because of their intrusiveness. Any good that is achieved by intrusive, coercive means, be these mild or Draconian, looses it’s moral significance. It can’t even be considered a bona fide human good, one that’s brought about by human beings, because such a good must be the result of human choice and not coercion, not from having a gun put to the heads of the human agent.
And this has to do with the connection between responsibility, ethics, and freedom, the kind that the classical liberal tradition has started to emphasize more and more over the last 500 years and which had its full public impact during the American Revolution with an official document, the Declaration of Independence, that enshrined those ideas as political guidelines.
The Declaration of Independence makes reference to our unalienable natural rights, ones no one can lose as long as one is human. Those are the rights to life, liberty, the pursuit of one’s happiness, among others (!), all of which require one to be free to choose. (Notice it doesn’t mean that one has a right to happiness but to the pursuit of it, something that no one can guarantee that anyone will actually do.) Having the right to choose doesn’t mean that one will in fact exercise it. One might not. Even to pursue happiness is but an option, not a demand–one may just decide to settle for being melancholy (as one recent book recommends–it argues that melancholia is a healthier state for civilized human beings than the pursuit of happiness).
In any case, no one can have a moral life, conduct oneself in morally significant ways, act morally responsibly, without the right to freedom. Its’ not possible and those who try to promote that idea are badly mistaken.
*This is a transcript of a lecture delivered at Cato University, San Diego, CA , in July 2009.