TGIF: Why the State Is Corrupt

Why is government corrupt? You'll notice that I did not ask, "Is government corrupt." We've had enough experience to go right to the main question. I might have softened it with the phrase tends to be to acknowledge that not everyone in government is corrupt, at least not in the conventional sense. Lord Acton's statement was, "Power tends to corrupt, and absolute power corrupts absolutely" -- although I wish he had added, "Power also attracts the corrupt."

At any rate, we have a question on the table. Let's go beyond the easy answer. Obviously, any government is intrinsically corrupt because it uniquely has the widely approved ("legitimate") power -- for "the common good" -- to use physical force against others who never used force against anyone. The state's personnel should know that they benefit at others' expense on the basis of this dishonest claim.

For most of the public, of course, that's not corruption. Thank the government's own schools in large part for that. As philosopher Michael Huemer points out, in challenging political authority (as others have), most people have no problem with government officials doing things by force that would be condemned if anyone else did them. No one thinks it would be proper for non-officials to extort money from their neighbors to feed hungry people or to pursue another good cause. For the government, the rules are different. Why? Huemer demolishes the popular answers. (See his The Problem of Political Authority.)

Let's leave that aside and look at what everyone would consider corruption (at least if the opposing team did it). That includes politicians or bureaucrats who benefit financially or otherwise from performing certain actions. When such transactions become known, we call them scandals. These involve privileges in the proper sense of the word, not the pseudo-privileges implied by the weird terms overprivileged and underprivileged.

So why is such corruption endemic around the world? It doesn't take much imagination to see why; it relates to the more fundamental kind of corruption already discussed. Certain politicians and bureaucrats are close to the power the government has to hand out other people's money, both directly and indirectly. A subsidy is an example of direct distribution. A tariff or competition-stifling regulation is an example of indirect distribution. In both sorts of cases money is politically and coercively transferred from some people -- taxpayers, consumers, disfavored businesses  -- to a favored person, business, or industry. Inflation, brought to you by the Federal Reserve's money creation and government borrowing, is another way to transfer wealth through the shifting of purchasing power.

Since some officials have access to such transfer power, other people outside the government will seek to benefit by currying favor with them. Reluctantly, some business people may do so just to keep up with competitors who are doing it.

History is full of stories of benefits provided to politicians and bureaucrats in return for political favors: outright bribes, campaign contributions, expensive vacations, post-retirement jobs, sinecures for family members (even relatives of presidents, if you can believe that!), and more. The buyer of favors might even be a foreign official who wants better treatment for himself or his government. Let's also acknowledge that the favor sought might be something that libertarians would approve of, such as the repeal of an unjust government policy, such as a tax, regulation, or trade embargo. Ironically, corruption could serve a good cause.

Of course, some people in government will not be tempted by corrupt offers, but others will be, and still others will be disappointed that no offers are tendered. It will be hard for voters to tell who's who. As for those who accept such offers, it would not necessarily mean they are malicious. They may really believe they are promoters of the "public good" and deserve to stay in power and enjoy its perks. I'm not saying that's a good excuse. We know how the road to hell is paved.

We shouldn't be shocked by scandals, but we should be perturbed. Attempted reforms such as mandatory disclosure and the like have not shown notable success. Proximity to power holds temptations that many will find too good to resist. As the Public Choice school of political economy teaches us, people don't become saints the moment they take government jobs.

The only way to change this is to radically reduce, check, and decentralize (if we can't eliminate) government power.

 

TGIF: On "Giving Back"

P&G, the maker of popular household brands like Tide and Downy laundry products, is giving away $10,000 in college scholarships. That's $1.5 million and 150 scholarships in all. My problem, aside from its encouraging college attendance, is with how the company is promoting the program. The television ads proclaim that the company sees the scholarships as a way of "giving back." I've written about this before, but some further thoughts might be useful.

So, to whom does P&G wish to give back? Not to existing customers exclusively. The only eligibility requirements are U.S. residency, a minimum age of 16, enrollment in or acceptance by an undergraduate program, and free registration at P&G's website. The online application does ask applicants if they are first-generation college students and where they do their laundry, which sounds creepy. The program is called a "sweepstakes", and multiple entries are apparently allowed, so the winners are apparently picked randomly. The winners' checks will be sent to the schools.

The "payback" angle that P&G touts will sound good to many people. ("Aw, that's so nice.") I suppose P&G never even considered entries by saying:

Because we at P&G are always looking for ways to increase our profits by creating goodwill, keeping our current customers from looking at rival products, and luring new customers from our competitors, we are giving away 150 scholarships worth $10,000 each. We'd prefer you to just buy our great products, but if that's what it takes to get good publicity, so be it. Enter today!

That would offend too many people, though pro-market and pro-free-enterprise people like me would be approvingly amused. Why call it "giving back"? Unearned guilt, what's why.

Adam Smith famously wrote that we do not believe the grocer puts food on the shelves because they are nice people (which of course they may well be). They do it because that's how they earn a living. Smith wasn't being pedantic. He was acknowledging that shoppers already know this. He writes, "We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages." (Sometimes we talk of our own necessities, for instance, when we can't find what we want. But we know the grocer doesn't help us out because he loves us.)

The "logic" of payback addresses the matter from the seller's, not the buyer's, side. Smith could have addressed grocers by writing:

It is not from the benevolence of the customers that you expect your income but from their regard to their own interest. You address yourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages.

Telling this to merchants would hardly be necessary. No merchant thinks his customers are doing him a favor by shopping in his store. A salesperson asks customers, "How can I help you," not "Here's how you can help me." It's true that when transactions are complete, both the merchant and customer typically express gratitude. It's what John Stossel calls the double thank-you moment. That's an interesting peculiarity of markets. The people on both sides of the counter seem grateful. Each party knows that the other could have been somewhere else. But at the same time, each knows that the other is (properly) acting in his own self-interest. Maybe that is why we are all grateful. Or maybe we're unwittingly approving of the harmonization of diverse interests in a market setting.

P&G and every company that claims to be "paying back" act as if they think we're stupid -- that we buy to help them out and so are owed something. But I don't think that's what such companies really believe. I think they talk about payback because they, like nearly everyone else, suffer from antimarket bias. Even business people have absorbed the view that profit-making is exploitative. To assuage the guilt, they "give back" to their victims. That is sad. It's also wrong. In the absence of coercion, fraud, and government favors, no exploitation occurs.

When two people trade, we know that at that moment each is confident he is getting more than he is giving up. The trade would not happen otherwise. Afterward, one or both may have regrets, but that's a fact of life when you're fallible. Note, though, that in our competitive economy, sellers, eager to win customers, accept returns, no questions asked. That was unusual not so long ago.

As for the seller's profit, in its financial sense it results when buyers value a product so much that they are willing to pay more for it than it costs others to make and provide. It's a reward for the welfare-enhancing service of correcting price discrepancies.

Profit's bad reputation is unearned, But it's not true that only sellers can make a profit. Buyers do also, though in a non-financial sense, because they prefer the thing they obtain to the money's alternative use. Moreover, to the extent that they pay less for an item than they were willing to pay, buyers make an additional profit. No exploitation occurs, of course.

Trade is the harmony of interest on glorious display, and we should celebrate that freedom makes it possible. Now if only we could find a way to get the favor-granting politicians and bureaucrats out of the way.

TGIF: Why Liberty Matters

Why does liberty matter? It’s a fair question because, after all, not everyone thinks it matters very much, perhaps beyond some very basic point. If that’s an overstatement, we can safely say that for many people on the left and right, liberty is a lower priority than it is for libertarians and classical liberals. Most pundits and politicians, even most anti-war types, have plans for how to spend your money.

What can we libertarians say? We have lots to say. It's a multifront operation. Some libertarians press the case in terms of moral consequentialism, either utilitarian or egoist. Others take a duty-oriented, or deontological, route, stressing a rule-boundedness that may look like a rights theory. (Rule-consequentialism, as opposed to act-consequentialism, ends up looking like this.)

A third approach is eudaimonia, or virtue ethics, which has been inherited from the ancient Greeks, for example in Aristotle's Nichomachean Ethics. In this approach, consequences are not irrelevant -- in fact, they are baked into the conception of features (virtues) that tend toward the perfection of the individual person as a rational social being. In brief, respecting other people as ends in themselves is integral to respecting oneself. I like this approach.

The problem with persuading others about all this is that proof is difficult. It's not like mathematics or physics. Aristotle wrote that the quality of proof in one area of knowledge, say, mathematics, is not to be expected in other areas, say, ethics. You have to play the hand that reality has dealt.

Modern libertarians have been debating among themselves the proper foundation of the freedom philosophy for decades. I can recall a libertarian scholars conference nearly 50 years ago when Murray Rothbard and historian friends expressed frustration over yet another panel of philosophers arguing the fine details of their respective approaches. The philosophical debate is important, but it's easy to get lost in the weeds. Does it matter to the public? Most nonlibertarians are not philosophers or interested in philosophy.

Leaving all that aside (and to people more qualified than I am), what can libertarians say to regular people? The general public often takes positions and attitudes based on cultural and media signals, but that doesn't mean we should not try to win regular people over directly, say, through the internet. Lots of opinion-makers have an incentive to ignore us.

To make our case, I want to start by saying that we know one thing clearly: each individual's life is important to him or her. People care about themselves. Each cares about other people too, but those others are important to the one doing the caring. Far from ruling out regard for others, properly conceived self-interest requires regard for others. It's self-evident. We're social beings. We flourish partly through all sorts of instrumental and constitutive relationships with others.

Each person generally wants life to be long and satisfying. We can call that flourishing. Life is a project, and it consists of many sub-projects. We are not ghosts. Projects require material things: a place to live and work, nourishment, tools, products, and so on. In a word, possessions. If people are to flourish they need to know that their possessions are secure. They need rights, including property rights, to define zones in which they can act free of compulsion. Our nature requires it, so they are natural rights.

We can sum all this up with the term self-ownership, to which no coherent alternative exists. The American abolitionists called slave masters "manstealers." How apt. In 1864 Lincoln wrote in a letter that "if slavery is not wrong, nothing is wrong." (I know about Lincoln's faults.) Here's the logical corollary to that truth: if self-ownership is not right, nothing is right. That's the libertarian philosophy in concentrated form.

Does knowing this solve all social problems? Of course not. Exactly when conduct begins to become aggression can't always be decided in an armchair. Boundaries can be fuzzy; social conventions will emerge. Life is about grappling with problems. (Sowell says there are no solutions, only trade-offs.) Context matters. So peaceful dispute-resolution will always be necessary, preferably not provided by a coercive government. That doesn't keep self-ownership from being a strong and reasonable guide to grappling with interpersonal problems. On the contrary, it justifies a presumption of liberty.

Critics will ask about the blameless who have little, who wonder where their next meal will come from, and how they will get education or medical attention. Fair question, and we have answers. The primary one is that free people in a free market produce great abundance and variety, which they are eager to sell or rent to others. (Even the hampered market has done this to a great extent for a couple of hundred years.) The West's move toward markets brought the first mass production, which did not always please the aristocracy.

Moreover, the governmental causes of the worst times in history -- from war to domestic mass murder to depression -- can be readily demonstrated. They were not the product of freedom, which common sense tells you is the right way for rational social beings to live.

While these times seem unfriendly to the freedom philosophy, it's possible that this philosophy will eventually delight the people fed up with the woke progressives, national conservatives, and neoconservatives. Maybe time is on freedom's side.

TGIF: Shame on Government for Censoring Us

Alas, federal District Judge Terry A. Doughty's preliminary injunction against government censorship of us on social media has been put on hold.

So rules three members of the Fifth Circuit Court of Appeals. But this stay of the injunction in State of Missouri et al. v. Joseph R. Biden Jr. et al. is temporary. NBC News reported a couple of weeks ago that "a different panel drawn from the [same appellate] court, which has 17 active members, will hear arguments on a longer stay." The matter could be resolved quickly though because the three judges "called for arguments in the case to be scheduled on an expedited basis."

So for now, however, we're back where we started. Judge Doughty had turned down the government's first request that the injunction be put on hold, writing,

Defendants argue that the injunction should be stayed because it might interfere with the Government’s ability to continue working with social-media companies to censor Americans’ core political speech on the basis of viewpoint. In other words, the Government seeks a stay of the injunction so that it can continue violating the First Amendment.

You gotta love this guy!

In light of the stay, let's look closely at Judge Doughty's reasons for forbidding federal agencies and personnel from indirectly censoring the public's constitutionally protected speech by pressuring social media to delete or suppress posts they dislike. He spelled out the grounds in great detail in his 155-page ruling.

Recall that the states of Missouri and Louisiana and several private individuals sued the Biden administration, claiming that it is doing what it may not do even indirectly, censoring constitutionally protected speech by putting all sorts of pressure on social-media companies. This was used to silence dissenters whether or not their posts contained true or false information. The posts and links were related to the COVID-19 pandemic, the Hunter Biden laptop, and other subjects. (For background, see my articles here and here.)

Under the First Amendment (and common-sense morality), of course, the government may not censor us directly. The Supreme Court has clearly said that the government also may not require private companies to do censoring for it. Any "request" from the government always carries the implicit threat of reprisal should the recipient of the request say no.

To begin with Doughty's conclusion:

The Plaintiffs are likely to succeed on the merits in establishing that the Government has used its power to silence the opposition. Opposition to COVID-19 vaccines; opposition to COVID-19 masking and lockdowns; opposition to the lab-leak theory of COVID-19; opposition to the validity of the 2020 election; opposition to President Biden’s policies; statements that the Hunter Biden laptop story was true; and opposition to policies of the government officials in power. All were suppressed. It is quite telling that each example or category of suppressed speech was conservative in nature. This targeted suppression of conservative ideas is a perfect example of viewpoint discrimination of political speech. American citizens have the right to engage in free debate about the significant issues affecting the country. Although this case is still relatively young, and at this stage the Court is only examining it in terms of Plaintiffs’ likelihood of success on the merits, the evidence produced thus far depicts an almost dystopian scenario. During the COVID-19 pandemic, a period perhaps best characterized by widespread doubt and uncertainty, the United States Government seems to have assumed a role similar to an Orwellian “Ministry of Truth. [Emphasis added.]

The Plaintiffs have presented substantial evidence in support of their claims that they were the victims of a far-reaching and widespread censorship campaign. This court finds that they are likely to succeed on the merits of their First Amendment free speech claim against the Defendants.

Note that he twice says the Plaintiffs are likely to succeed in their suit. That's one of the criteria for a preliminary injunction while a case is still in progress. Should the plaintiffs lose, his injunction would be null and void. But given the subject -- the First Amendment and free speech -- Doughty is pretty sure they are not going to lose. He also was persuaded by the plaintiffs that if he did not stop the government right now, "irreparable harm" would ensue.

Doughty opened his opinion with this:

This case is about the Free Speech Clause in the First Amendment to the United States Constitution. The explosion of social-media platforms has resulted in unique free speech issues—this is especially true in light of the COVID-19 pandemic. If the allegations made by Plaintiffs are true, the present case arguably involves the most massive attack against free speech in United States’ history. In their attempts to suppress alleged disinformation, the Federal Government, and particularly the Defendants named here, are alleged to have blatantly ignored the First Amendment’s right to free speech. [Emphasis added.]

This is remarkable. Since Doughty thinks the plaintiffs are likely to prevail, he must also agree that the case "involves the most massive attack against free speech in United States’ history."

If you wonder whether that's an exaggeration, peruse the judge's ruling. It details the offenses and justifies the application of his injunction to each of the named defendants. It's breathtaking.