by Alex Chafuen
Before jumps in inflation I used to see articles like this in Argentina. This piece by Steve Conover appearing in the AEI magazine argues that the “[l]ack of sufficient economic growth is behind most if not all of our fiscal and monetary problems,” and so printing money is not so bad. The current manipulation of money and credit is very dangerous. No doubt that an increase in the demand for cash holdings (what some call “velocity of circulation,” as if money would have an engine. . .) can off-set the printing of money, but there is a limit.
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No matter your race, color, creed, gender, sexual orientation, or favorite football team, there has never been a better time to be alive, broadly speaking, than right now — and it’s getting better all the time. Sadly, a lot of people don’t know it, know it and don’t care, or know it and hate it.
I used to have a chunk of the Berlin Wall that I would show to students during a brief discussion of why ideas, and the ideas at the foundation of Western civilization, matter. I’ve misplaced that piece of the Wall.
In Suicide of the West, Jonah Goldberg explains how intellectuals especially have misplaced their understanding of and enthusiasm for the West’s halting and imperfect but nonetheless revolutionary experiment in liberty. Fewer than two generations have passed since Nazism was defeated, and yet tribalism, nationalism, and populism are making a comeback. It hasn’t been a generation — not even 30 years, as of this writing — since the Berlin Wall came down, and elite media outlets are telling us “It’s Time to Give Socialism a Try” (Washington Post) and “Free Speech Is Killing Us” (New York Times).
Just as I hope I rediscover my piece of the Wall, I hope thought leaders, politicians, executives, and others who are so enamored of the politics of control — whether in their left-wing versions as embodied in Bernie Sanders and Alexandria Ocasio-Cortez or in their right-wing versions as embodied in Donald Trump — rediscover the ideas that made liberty and prosperity possible.
Suicide of the West is an entry in a long and venerable tradition of jeremiads lamenting the crumbling foundations of Western civilization and predicting doom if something doesn’t change. It is comfort food for people (like me) who think the Western tradition, for all its warts and imperfections, has much to recommend it. Goldberg invites readers to consider very carefully where we have been, what has gotten us where we are, and where we might go if we don’t guard the political and cultural institutions that have allowed so many of us to flourish in ways our ancestors couldn’t have imagined.
Goldberg begins with “some assertions” on page 6. What seems obvious to us today is actually a radical break from the way things have always been. Here is Goldberg:
Capitalism is unnatural. Democracy is unnatural. Human rights are unnatural. The world we live in today is unnatural, and we stumbled into it more or less by accident. The natural state of mankind is grinding poverty punctuated by horrific violence terminating with an early death. It was like this for a very, very long time.
How long? He asks the reader to “imagine you’re an alien assigned with keeping tabs on Homo sapiens over the last 250,000 years. Every 10,000 years you check in.” Pretty much every entry is “Semi-hairless, upright, nomadic apes foraging and fighting for food. No change.” On your visit about 10,000 years ago, you would notice that things had changed a bit with the development of settled agriculture. Alien observers arriving in 2019 would find a world that is utterly unlike anything they observed on their previous visits — and essentially all of the progress has been limited to the last three centuries. It isn’t too much of an exaggeration to say that I enjoyed a bigger increase in my standard of living with the last software update for my phone than my medieval ancestors enjoyed in a lifetime.
Goldberg spends the rest of the book evaluating what the sociologist Robin Fox and the historian Ernest Gellner call “the Miracle.” He draws a lot of inspiration from Deirdre McCloskey’s magisterial project on what she calls the Bourgeois Era (which he documents in an appendix). Her thesis, in short, is that what she calls the Great Enrichment happened because new ideas about liberty and dignity for common people and innovators emerged in northwestern Europe (of all places) and then spread slowly and imperfectly around the world. No doubt it pales in comparison to the very best world we can imagine, but it is unambiguously better than the world our ancestors inhabited.
How? Goldberg explains all the ways that will be familiar to people who have read McCloskey, Steven Pinker, and Hans Rosling (I summarize some of these facts here). Violence is lower. Life expectancy has risen. Child mortality has plummeted. Compared with our ancient hunter-gatherer ancestors, we are far less likely to have our heads crushed in late adolescence or early adulthood by a rock-wielding member of a rival tribe. In the course of about a century, one of the most ancient and vile of human institutions — slavery — was abolished. We live longer, healthier, richer lives — and we take it for granted.
Goldberg asks his readers to consider two versions of the classic tale of the goose that laid the golden eggs. Adam Smith’s golden-egg-laying goose — “the liberal plan of equality, liberty, and justice” — arrived on the scene in the middle of the 18th century, give or take a few decades. In one version of the story, a man asks the goose to lay even more golden eggs and then simply kills the goose in a fit of rage when it turns out it can’t. In the second version, the people who come to own the golden goose reason that there must be gold inside the goose if it is laying golden eggs — so they kill the goose to get at the gold. Neither story ends happily as people indulge their impatience and ingratitude.
Western civilization, Goldberg argues, is like the goose that laid the golden eggs. The “burn it all down” ethos of destructionism puts us in danger of killing the goose in our impatient rage at the unacceptable pace with which it lays golden eggs. It is no less folly to think we can immanentize the eschaton by killing the goose to get at the gold for which we are so impatient. It is a grave mistake to think so confidently that the liberty, equality, and prosperity we take for granted happen automatically.
In other words, as Goldberg points out on page 66, “Poverty is natural; wealth takes effort.” The same, he argues, is true of inequality, war, slavery, and oppression. It has to be sustained by continued and deliberate effort, and this is no easy task. As Hannah Arendt has pointed out, “every generation, civilization is invaded by barbarians — we call them ‘children’” (cf. p. 274). The work isn’t done even once they are at least nominally civilized: as Goldberg discusses in his second chapter, even the most civilized and refined group devolves into the horror of William Golding’s Lord of the Flies (pp. 47 ff.) — and even the most nominally civilized are capable of “the horror, the horror” of Joseph Conrad’s Heart of Darkness.
He offers an interesting take on “corruption,” one that will stick with the reader. Goldberg asks us to imagine a brand-new car left in a field unattended (p. 349). Without investment, upkeep, and hard work, nature reclaims it. Any homeowner knows this: Air conditioners break. Roofs and pipes leak. Decay and corruption are forces of nature that have to be fought deliberately. Goldberg argues that decay and corruption are natural forces in the social realm. Over time, an untended garden, house, or car gets overtaken by nature. So too does an untended relationship. Or culture. Or civilization.
At this point, my inner angsty teenager, social reformer, and humanitarian are joining their voices in protest. They feel that this is a limited, stunted, and unhappy conclusion, and they push back against so-called constraints in the felt conviction that “there must be a better way!” (p. 14). Goldberg calls it “romanticism,” by which he means (pp. 13–14, emphasis in original)
the primacy of feelings. Specifically, the feeling that the world we live in is not right, that it is unsatisfying and devoid of authenticity and meaning (or simply requires too much of us and there must be an easier way). Secondarily, because our feelings tell us that the world is out of balance, rigged, artificial, unfair, or — most often — oppressive and exploitative, our natural wiring drives us to the belief that someone must be responsible.
According to Goldberg, however, there really is no easily achievable and obvious “better way.” Romanticism, he argues, is the road to corruption: “The greatest force in the corruption of modernity is the organized political effort — active in every generation — to impose the rules of gemeinschaft on the gesellschaft,” (p. 64), where “gemeinschaft” is “the personal order of family, friends, and community” while “gesellschaft” is “the external, impersonal, order of contracts, commerce, and law” (p. 62). As he notes, following Friedrich Hayek, the rules that make gemeinschaft work are incompatible with gesellschaft, and the rules that make gesellschaft work are incompatible with gemeinschaft. Charging a stranger a fee to rent a room in your house on Airbnb works reasonably well. Charging your child a fee to rent a room in your house does not.
A lot of people, though, imagine a world in which we relate to and care about one another the same way we relate to and care about our children and our close personal friends. I particularly enjoyed a profoundly Smithian point raised by former senator (and father of my former department chair from my time at Rhodes College) Phil Gramm, who said that his policy on children was that no one could love his children like he and his wife.
An audience member objected, saying, “No, that’s not true: I love your children as much as you do.” Gramm’s reply: “Oh really? What are their names?” (p. 302). It’s a sublime point: we can love strangers, but not intimately — or not at any rate the way we love our friends and family.
It reminds me of a tragic scene in Eugene Richter’s Pictures of the Socialistic Future in which a mother’s knowledge about her daughter is ignored by those in charge of state child care. It ends tragically. The scene Goldberg recounts here is a brief and powerful illustration of the arrogance and presumption that comes with thinking we can simply choose to reject gesellschaft and embrace gemeinschaft as the only proper governing principle for a world of seven and a half billion people.
I paraphrase Deirdre McCloskey: the romantic anti-liberal vision turns an impossible and wholly imaginary Best into a very possible and very actual Pretty Good, or at Least Much Better Than Things Have Typically Been. Incremental improvement? Yes. Radical reimagining of humanity and society? We tried that in the 20th century, and it was, to borrow a phrase from Ayn Rand, akin to “tearing the lid off hell.” Goldberg explores the tension between free societies and grand social projects. The former most definitely are not the latter. Economic and political liberty per se do not provide people with a sense of meaning. This is apt to be very depressing to the legislator or reformer Adam Smith calls “the man of system,” who “is apt to be very wise in his own conceit” and “often so enamoured with the supposed beauty of his own ideal plan of government, that he cannot suffer the smallest deviation from any part of it.”
To the man of system then and now, the evolved, mediating institutions of civil society (the family, for example) simply aren’t legible. He can’t see in them an articulated and transcendent purpose, but he concludes that when he sees anything in them that is unlovely, it is because someone out of avarice or malevolence designed it that way. This is where the man of system is most dangerous. It is so very, very tempting to think that if only we were in charge, or people like us, or people we choose, everything would be great — and we can’t be faulted for trying hard and meaning well. This isn’t so. As economists and other social scientists have tirelessly pointed out for centuries, you don’t need bad intentions to create bad consequences. Goldberg likens the state and civil society to a tourist exploring a coral reef (p. 301):
If you’ve ever been scuba diving or snorkeling, you probably know that swimmers aren’t supposed to touch the coral with their bare hands. We have oils in our skin that disrupt the membranes of coral and can even kill a whole colony. The state is a greasy-handed tourist in civil society.
The American Founders, perhaps, were then quite wise to see themselves as “gardeners, not engineers” (p. 153). And perhaps social scientists would be most useful to society if we (re)discovered an ethic of “look, don’t touch” — or as Steven Landsburg pointed out in sharp contrast to Karl Marx, the economist’s goal should be to understand the world, not to change it.
In any case, at root is a conflict of visions: people like Goldberg (and Adam Smith, and F.A. Hayek, and Milton Friedman, and Thomas Sowell) believe that human nature is fixed. Others — much of the modern Left — believe it is social conditioning all the way down and can, therefore, be changed by changing the social institutions. It’s possible, in this view, to remake a society after an articulated and designed pattern. All that’s needed is “political will,” which loosely translated means “unchecked power for me and my friends.” Lest you think I’m exaggerating, Goldberg makes much of the intellectual rebellion against enlightenment liberalism during the Progressive Era. Hence we got the rise of the administrative state, what some believe to be a de facto fourth branch of government.
Stylistically, Suicide of the West is an easy and fun read. Goldberg can turn a phrase beautifully, the prose is clear, and it skips along in ways a lot of 400+ page doorstops simply don’t. Goldberg calls his readers to the defense of Western civilization against attackers from left and right. I can only hope we are up to the task.
Click here to hear Jonah Goldberg discuss the book with Russ Roberts on EconTalk.
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The news and sports media have been focused on the recent confrontation between the National Basketball Association (NBA) and the Chinese government due to a tweet by the general manager of the Houston Rockets about recent pro-democracy demonstrations in Hong Kong that brought down the wrath of China. While many commentaries have focused on the NBA’s attempt to placate the Chinese authorities in the face of losing millions if not billions of dollars in lost revenues in the Chinese market, less attention has been given to what lies behind it all: a government’s ability to shut down commercial dealings between willing participants by simple command.
It all began when Rockets General Manager Daryl Morey posted a personal tweet that said, “Flight for freedom, stand for Hong Kong.” For several months massive and sometimes violent demonstrations have been going on in the former British colony of Hong Kong. When the British Union Jack was lowered from the last flag pole in Hong Kong in 1997, there was an agreement between London and Beijing that for several decades Chinese authority within the former colony would not interfere with many if not most of the freedoms that people had enjoyed for a good part of the time since 1842, when Hong Kong came under British jurisdiction.
China’s Threats to Freedom in Hong Kong
The arrangement was known as “One Country, Two Systems,” meaning that on the Chinese mainland, the Communist Party ruled with their existing authoritarian power, while in Hong Kong, many of the internal affairs of the territory would remain untouched by Beijing. But especially in recent years, the Chinese government has been attempting to eat away at the freedoms enjoyed by the people of Hong Kong, including freedom of speech and the press, which has often taken the form of harsh commentaries on Chinese government domestic and foreign policies.
What set off the demonstrations early in the summer of 2019 was a proposed law that would more easily compel the extradition to China of those accused of illegal acts against Chinese law. The extradition proposal itself was really less than it was made out to be, given other Chinese encroachments on Hong Kong freedoms. It was more like a straw-that-breaks-the-camel’s-back that sent waves of people, weekend after weekend, into the streets of the city. The demonstrators’ demands have been not only a withdrawing of the extradition legislation, but demands that the Chinese government respect the freedom of the people of Hong Kong in general, with even some voices calling for Hong Kong’s independence.
China’s Domestic Authoritarianism and Global Imperialism
Chinese President Xi Jinping has not only been tightening the authoritarian screws at home against any and all dissent against him or his government, he has been far more aggressively nationalistic in his foreign policies, insisting on reestablishing a global place in the sun for China through a grand mercantilist-type vision of growing Chinese influence and power over many other parts of the world. (See my article “Economic Armaments and China’s Global Ambitions.”)
Many if not most territories “lost” by China in past centuries are often expressed as fair game to once more bring back into the administrative fold of those in Beijing. Thus, the Chinese government insists that a good part of the South China Sea is “historical” Chinese territory, on which they have been building a series of artificial islands and demanding that other nations stay out of these newly established territorial waters without their permission.
It is equally on this basis that Beijing says that Hong Kong as well as the self-ruling island of Taiwan is part of China. It is the reason the Chinese government opposes “separatist” talk concerning Tibet or among the Muslim Uighur population in the huge western region of Xinjiang, where from all accounts the Chinese authorities have incarcerated upward of a million Uighurs in “re-education camps” that others call mass detention centers; reportedly harsh and even brutal treatment is experienced by those who challenge those who rule over them in these camps. (See my article “Freedom and the Right of Self-Determination.”)
A Tweet Brings China Down on the NBA
So, given the direction of Chinese domestic and foreign policy, when Daryl Morey tweeted his support for the Hong Kong demonstrators and their cause, this immediately set off the ire of the Chinese government. All media and public broadcasting of Houston Rocket basketball events were banned from the Chinese airwaves. Rockets team sportswear and paraphernalia were banned from sale in China. This was followed by the end to a wide variety of business and other commercial relationships between the NBA in general and Chinese businesses, including the threat of breaking endorsement and other ties between leading American basketball players and Chinese companies.
Millions, if not billions, of dollars of revenues were now at risk of being lost, all because of a tweet and the hesitation by the NBA and individual team owners and representatives to unequivocally distance themselves from the Houston Rockets, or the Rockets’ own partial apologies for offending the “Chinese people.”
In the United States, conservative and “progressive” politicians and pundits lambasted the NBA for not standing up to the Chinese government and its attempt to hinder the freedom of speech of NBA administrators and team members. The NBA was told by voices all across the U.S. political spectrum that their reluctance to tell the Chinese authorities “Hell, No” demonstrated that the NBA and the individual teams placed the fear of lost profits above the political principle of freedom of speech. It showed the decadence of “capitalism” and the greed of those interested only in money.
Some of these pundits pointed out the hypocrisy of the NBA, which has heralded the right and freedom of its players to publicly speak out against “social injustice” and the policies of the current president of the United States, but which now kowtowed to a foreign government threatening its financial bottom line from lost business in China.
China’s Reaction to the NBA and the Importance of Economic Liberty
What has been missed in all this, I would suggest, is the important institutional dilemma when any government has the power and authority to dictate with whom its own citizens do business and on what basis and terms of exchange. That the day after Morey’s tweet suddenly all of the leading Chinese media outlets and enterprises doing business with the Rockets and the NBA in general announced that they were halting or cancelling their dealings with the Americans makes it very clear that this was not a “spontaneous” series of acts by private Chinese citizens simultaneously upset with the words and deeds of their American business partners.
This was a command coming from the Beijing government authorities to whom all those Chinese enterprises — public and private — are absolutely answerable for their existence and financial survival. Even think of disobeying, and literally “heads would roll” in terms of being fired from state enterprises and having your legal ability to operate threatened in your nominally “private” enterprise.
It should have demonstrated, beyond a shadow of a doubt, that however much China has been praised for its four decades of economic reforms in a direction permitting degrees of individual initiative and private business, the entire Chinese economy remains under the microscopic control and command of the government. If and when businesses are left alone by the Chinese government, it is when those directing and managing those enterprises are doing what is explicitly or implicitly in the directions the Chinese authorities wants them to be moving.
And when those doing the central planning of the Chinese economy, starting with President Xi at the top, want any or all of those enterprisers to do different things differently, they are instantly at the beck and call of those holding the power of life and death over them and their businesses. This is the meaning of “socialism with Chinese characteristics.” Others might call it economic fascism, under which businesses may nominally be in private hands, but it is the government that ultimately determines and dictates how those in charge of their businesses go about doing business. In other words, economic fascism is simply socialism with nominal (and not real) private-enterprise characteristics.
Beijing Regularly Threatens American Businesses
The Chinese government has used this power to strong-arm American companies doing business in China numerous times over the years, including being at the service of the communist authorities in their attempt to surveil everyone in the country and dictate the type of political, social, economic, and historical information that will be accessible to citizens of China. In other instances, it has concerned an American company sharing proprietary technology with a Chinese enterprise with which it wants to do business. And at other times, it has been more crassly materialistic, with the expectation that a U.S. company will give a bribe or appoint some government higher-up’s son or nephew to a well-paying position in a joint U.S.–Chinese enterprise
In this latest instance concerning the NBA, it is demanding that a group of American sports teams either keep their collective mouths shut on political matters dear to the Chinese government or parrot the Communist Party ideological line, after giving the necessary public and groveling apology for daring to challenge anything said or done by the rising global power of the 21st century.
In the hysteria of an American political election season, the worst thing that could happen would be if politicians and pundits now propose to legislate or regulate the response by the NBA or the Houston Rockets to the Chinese government. With all the chatter about the Chinese attempting to abridge the freedom of speech of Americans through the weapon of financial intimidation if they want to do business in China, it then would be the U.S. government dictating what those sports teams and their NBA representatives could say and agree to in trying to salvage their growing business in China.
The U.S. authorities would be merely doing a political variation on the same commanding-and-controlling theme that the Chinese government is accused of doing. Plus, the establishment of such a precedent would only reinforce the degree to which the U.S. government already regulates, controls, restricts, and commands American enterprises in far too many ways and directions.
Donald Trump Cannot Dictate People’s Words or Actions
Those who have suggested hypocrisy in the NBA, in that domestically it encourages players to publicly express their political and social views on a variety of American policy-related issues, but cowers in fear before the Chinese government over a tweet, forget an important difference: the U.S. government cannot just shut down those teams and destroy their financial viability.
There is much made of President Donald Trump’s huffing and puffing about football players who kneel during the national anthem at the beginning of a game, or that he says how the mainstream media are out to get him and declares much of what they print and say to be “fake news.” His critics accuse him of trying to intimidate those who wish nothing more than express their views under the First Amendment to the Constitution and speak their minds as citizens of a democratic society.
There is one important difference in the words and actions of Donald Trump and those of President Xi Jinping and his government in China: Donald cannot command that all companies doing business with the NFL in terms of products, media coverage, or endorsement contracts are to stop doing so until every football player who has kneeled during the national anthem publicly apologize for “offending the American people” and promises to happily stand and sing along at the start of every game from now on.
Nor can the president of the United States order the firing of the heads of CNN or MSNBC, or command that Fox News get back in line never criticizing anything he says or does, like as good Trumpians they used to always do. The strength of freedom of speech in the United States is demonstrated by the fact that no matter how much Donald Trump may rant and rave, the mainstream media continues to report and editorialize just the way they want, no matter how much they say that he is a friend of fascism and an enemy of freedom.
Freedom Requires Separating Markets From the State
Why and how can they do this? Because in spite of the degree to which the government influences and regulates much in the American marketplace, it still remains institutionally grounded in an important and respected degree of personal freedom, private property, and freedom of enterprise outside of Chinese-style heavy-handed central planning. It is precisely because of the remaining degree of free enterprise in the United States, again, even with the existing interventionist and regulatory intrusions and controls, that sports teams and their members can make public statements of disagreement without being shut down, driven out of business, or arrested as “enemies of the people.” And the same applies to conflicting and competing news reporting and editorializing in the various forms of mass communication.
The essential lesson that should be drawn from this recent dispute between the National Basketball Association and the communist government of China is not that administrators and players in the NBA are being intimidated to make public apologies and toe the party line, but that this is why friends of freedom should always be concerned about and argue against government involvement and regulatory oversight and control over private enterprise and the free market.
It is not only that government regulation over business misdirects how and what private enterprises do, which deflects them away from competitively trying to find the best ways of satisfying consumer demands as the means to earning profits. That is certainly true.
Equally if not more importantly in terms of freedom in society, it is that every introduction and extension of government control, command, and regulation over the private affairs of the marketplace threatens the liberty of the citizenry. How you manage and direct your enterprise as a businessman; where and at what type of work you will be able to earn a living; and with whom you may do business and under what terms. All these become more and more dependent not on your free choices and voluntary associations with others on mutually agreed-upon terms, but upon the fate and favors of those in political power, and their goals and agenda to which you must conform or suffer potentially devastating consequences.
It is not just classical liberal ideologizing about the importance of separating the marketplace from the state, private enterprise from political control. The dilemma that the NBA and its affiliates find themselves in with the Chinese government is the latest example of why a free society is not sustainable without a functioning free market that is widely free and independent from the power of those in political authority.
Richard M. Ebeling, an AIER Senior Fellow, is the BB&T Distinguished Professor of Ethics and Free Enterprise Leadership at The Citadel, in Charleston, South Carolina. Ebeling lived on AIER’s campus from 2008 to 2009.