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August 14, 2003
I have often wondered about the content of this old post. I have puzzled about how often free market commentators in public policy give priority to the free market at the expense of democracy. Democracy is consistently downgraded or ignored and the fre market is the toucstone of everything. I sense an anti-democratic tendency when I read their interventions into public policy, but I have never bother to unpack it. Nor have I bothered to unpack the deep hostility to green legislation that is passed to protect the environment.
Thus my memory of reading Milton Friedman is that equates democracy with freedom and then with the free market. What is left out of the picture is democracy in the sense of a broad based voter participation in the political process. See this article which reinforces my memory.
What we get from the free market economists is the spontaneous free market versus the coercive state, the policy prescription that market forces should play a central role in our lives, and that government interference with market forces should be strictly limited. What we get is libertarianism without citizenship; a libertarianism that has socialism in its sights; a socialism structured around operfect knowledge, coercive commands, particular ends, ‘social justice’, and the political will.
But it is an odd sort of libertarianism. As I read their texts and weblogs I am reminded of Robert Menzies observations on Australian liberalism:
"The sturdy individualists in the country who resent any political interference apply for it every week. There is hardly a section in the community today that doesn't in one breath protest its undying hostility to Government activity and, in the next breath, pray for it."
The picture that you get the free market economists is that the Australia economy is moving towards the "free enterprise" system where competition produces firm efficiency, dynamism and wealth creation. The Australian federal and state governments are pictured as uninvolved or unimportant in these processes. They stay out of the way of market actors, do not try and pick firms or technologies as winners and losers, and if they intervene, it is only to make sure that competition is maintained through a light regulation. I presume the dream is for market players to regulate themselves.
Of course there is much going on in Australia that slips by accounts such as this downsizing Leviathan, upgrading freedom and seeing socialism everywhere. Take the conservatism that so often comes with the free market package: a conservatism that refers to nation as distinct from the market. This talks in terms of a people unified, a dominant historical narrative, national character traits:----one continent, one nation, one people. Underneath this is a strong sense of order and authority. See this post on the unity of the nation by a Burkean conservative. What we have here is a strong state defending the nation's borders and defending the West against Islamic enemy.
What then of democracy? The liberal nation-state is not just a Leviathen solely into command and control. It is a liberal democracy. Well, the logic of the free market position is being deeply suspicious of government and political processes. THe logic of this position is to see democracy as dangerous, in the sense that the legislation of the legislatures can encroach on freedom. If democracy as the rule of the majority is a threat to liberty, then democracy is a set of procedures and institutions designed to allow the citizenry to participate in public affairs by removing and replacing certain public officials. Democracy can only ever be only a means to an end—the end being freedom. If democracy is a device to produce liberty, then it is only justified if it produces liberty: ie., individuals pursuing their own ends within their own private spheres. If democracy fails to produce liberty, then it undermines the market order.
Hence it would be appropriate to suspend democracy to protect the market order; suspend democracy in favour of a totalitarian regime that protects the market order by upholding in the institutions that uphold the market order, such as private property. Thus the whole Chile phenomenon: the free market economists from Chicago supporting Pinochet's dictatorial regime. Today it is the greens who are the enemy because they use the legislature to pass green legislation that restricts freedom.
We get stuff like this circulating through the media:
"This is why the free market systems of the West increased prosperity, and raised social and environmental standards, while the command and control systems of the communist bloc destroyed both physical and social capital and degraded the environment."
What people like Alan Oxley quickly passed over is the way the free market systems in Australia have increased prosperity and degraded the environment.
Green influenced legislatures improve the environment by fiat and the compliance with policies is secured by sanctions.
That is my reading of the logic of free market economists. It is confirmed by Alex Robson in this article in the CIS Policy magazine. Democracy for Robson "merely merely specifies that certain public officials may retain office at the pleasure of the majority of voters, and that is all." Those who see democracy as popular sovereignty are demagogues who have corrupted the true meaning of democracy--a procedure for electing political leaders. These demagogues stand for the tyranny of the majority.
What we can infer from this is that free market economists such as Friedman and Robson do not value the participation of citizens in politics as much as they value individuals participation in the market. The sphere of politics is subordinate to that of the market.
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I keep telling you this! :P There are some who don't just lip service to what i think of as democracy, but they are a small minority in my experience.