Is Liberalism Brain-dead?
At least that would explain why so many liberals appear to be a fan of Hayek's, or at least his essay, "Why I am not a conservative."
Aside from comments on liberal blogs praising the essay with no particular stated reason, these are some of the passages they quote:
Personally, I find that the most objectionable feature of the conservative attitude is its propensity to reject well-substantiated new knowledge because it dislikes some of the consequences which seem to follow from it - or, to put it bluntly, its obscurantism.
I will nevertheless continue for the moment to describe as liberal the position which I hold and which I believe differs as much from true conservatism as from socialism
The only problem? From the same essay, I can quote this:
Conservatism proper is a legitimate, probably necessary, and certainly widespread attitude of opposition to drastic change. It has, since the French Revolution, for a century and a half played an important role in European politics. Until the rise of socialism its opposite was liberalism. There is nothing corresponding to this conflict in the history of the United States, because what in Europe was called "liberalism" was here the common tradition on which the American polity had been built: thus the defender of the American tradition was a liberal in the European sense.[2] This already existing confusion was made worse by the recent attempt to transplant to America the European type of conservatism, which, being alien to the American tradition, has acquired a somewhat odd character.
In other words, when Hayek says "conservative", he explicitly means European conservative (which makes sense, given that Hayek is a European, not an American), the likes of which America has never seen.
So, perhaps it is a simple reflection on the failure of liberal education system (with their blatant disregard of core 3Rs) that liberals who read this essay cannot understand the distinction Hayek makes between the conservatives in the U.S.A. and the conservatives elsewhere.
"But," you may say, "every movement has its morons." Surely I can't call liberalism brain-dead because some liberals happen to be?
Well, idiocy can be cured. Sophistry such as this cannot:
Now there is a diplomatic quality to Hayek’s essay, which could lead you to miss the fact that he is, in fact, talking about American conservatives. Pragmatically, Hayek regards American conservatives as his allies, but only because he thinks they can serve as a counterweight to socialism, not because he agrees with them philosophically. He thinks they have ‘a somewhat odd character’. The essay is, in part, an attempt to tell American-style conservatives this without really rubbing their noses in it – more flies with honey and all that.
Really? So everything else Hayek says about American founding values (which conservatives place great importance on), such as (Hayek uses "liberal" to note "classical liberal", and the fact that he refers to Jefferson as "radical" and Hamilton, the noted statist among Founding Fathers, as "conservative" should alert you to the fact that his terms are somewhat non-standard compared to modern usage),
It was the ideals of the English Whigs that inspired what later came to be known as the liberal movement in the whole of Europe[15] and that provided the conceptions that the American colonists carried with them and which guided them in their struggle for independence and in the establishment of their constitution.[16]
...
It is the doctrine which is at the basis of the common tradition of the Anglo-Saxon countries. It is the doctrine from which Continental liberalism took what is valuable in it. It is the doctrine on which the American system of government is based. In its pure form it is represented in the United States, not by the radicalism of Jefferson, nor by the conservatism of Hamilton or even of John Adams, but by the ideas of James Madison, the "father of the Constitution."[18]
All of this means nothing to Mr. Holbo? If Hayek was indeed addressing American conservatives, then in lauding James Madison as representing the "pure form" of classical liberalism, he was not telling American conservatives to stop being conservative; he was telling them to remain conservatives, and defend the Constitution—which is important not just because it's American, but in its current form, it represents the ideals of classical liberalism—from enemies foreign and domestic. I would take "criticisms" like that any day.
Jonah Goldberg has explained this for years, and yet, Mr. Holbo simply refuses to listen—and he's not alone.
And this is why liberalism is brain-dead. Morons, we can educate. Sophists, on the other hand, as Socrates found out the hard way, cannot be persuaded through logic—after all, it's their job to make the weaker argument stronger by twisting logic. Liberalism is nothing but an empty shell without its sophistry, which means it has to be brain-dead.
Update: To be fair, some of Hayek's criticism of conservatives was and is valid for some of the American conservatives—but they are valid only for certain (influential) versions of American conservatism, not for the core principles of American conservatism, as outlined here.
h/t: Stok
No more too big to fail … but?
The FDIC chief apparently thinks that no institution should be insulated from failure:
"I believe that the new regime should apply to all bank holding companies that are more than just shells and their affiliates regardless or not whether they are considered to be systemic risks," she said, adding that including only systemically important firms in the shut-down regime could reinforce the 'too big to fail' doctrine.
At first this sounds like a good idea (and Sheila Blair hates Geithner's gut, so she has this enemy-of-my-enemy factor going—although I am sure plenty of statists hate fellow statists). After all, capitalism works on a system of risks and rewards, and the moral hazard caused by the bailouts in the last year or so were the biggest damage to capitalism done in a while. Restoring the reality of risk will allow capitalists to act rationally.
But, according to Reuters, she wants to do this not by getting the government out of private affairs, but by digging it deeper into them:
FDIC Chairman Sheila Bair, speaking to the Institute of International Finance meeting here, said a U.S. proposal to create the authority to shut down failing systemically important financial firms may need to be extended to insurers and hedge funds.
Is that really a good idea? In other words, under her plan, the government is not necessarily picking winners (as in the last rounds of bailouts), but the government will be picking losers—as it will have the authority to shut down firms that no private actor sought to shut down. I don't really see the big difference between the two. Either way, the government—one of the most inefficient organizations in the world—is deeply involved, and there are plenty of channels through which political corruptions can destroy capitalism.
Why is there no one who simply says: capitalism doesn't need government to function, it needs the government to get out of the way. Laissez faire!
Deceptive statistics on infant mortality
Opponents of our private health care system often point to the infant mortality rate in U.S. compared to other countries, especially a communist one like Cuba to make their point that our private health care system is somehow deficient.
However, like any argument based in statistics1, there are many, many pitfalls.
The first obvious question to ask is (after seeing that the number is for every X live births), what about stillbirths? Is it possible that in U.S., what might have been stillbirth gets counted as infant mortality because our superior medical technology gets the child through delivery but the child ends up expiring anyway? Well, the statistics in comparison with a few other countries don't quite support that (although this would, of course, vary depending on what counts as stillbirth and what must be reported; and I can't find a quick comparison to Cuban data).
But the death of an infant counts as either stillbirth or infant mortality only if the parents wanted the child to live and gave their best shot at the delivery. Is it possible that in other countries, if the unborn child does not appear healthy (or "desirable"), that he is deliberately ... "given up"? There is some evidence to support this. It depends on which statistics you look at: if you look at the number of abortions per 1,000 women of child-bearing age, then North America has the lowest abortion rate of populated parts of the world, hands down, and all we have to do is explain the discrepancy between us and Canada. If you look at the number of abortions per 100 known pregnancies, then while the U.S. is at the bottom, other developed region, such as Western Europe are on par with the U.S. (this is actually a surprise to me).
Given that abortion rate far outstrips any infant mortality rate (in North America, 26 children are aborted per 100 known pregnancies!), there is a great potential for a general abortion pattern (maybe the poor get more abortions, the way liberals intend) to affect the infant mortality rate. So, once you include all the data, not just the ones that appear to support your argument, the picture is not quite so clear. It's possible that there is something wrong with infant care in U.S. It's possible that there is nothing substantially wrong with it. In any case, the case for "fixing" our system (is it broken in the first place?) is so weak that it does not merit the cost and social upheaval socialization of our health care system would involve.
P.S. I should note that the data I quote above are widely separated in time (the mortality rate including stillbirth is from a blog post in 2006, and the data on abortion is from 1996), so I wouldn't trust them beyond a general overview and trends, if that.
P.S. I think a better birth-related statistics that would be more reflective of the quality of health care is maternal death rate, not infant mortality rate. After all, so much of infant mortality has to do with genetics, as one of the links above gets at. On the other hand, the adult mother had and has the full benefit of the health care system, with serious genetic defects already filtered out by the process of natural selection, so it ought to be a more equitable measure of the health care system. And indeed, even at the highest level of maternal death rate, the maternal death rate in U.S. compares reasonably with the developed world and very favorably against all the developing regions, including Asia. But then, liberals are not known for letting facts get in their line of argument, so they will continue to cite one unfavorable statistic after another, regardless of how deceptive they might be in the things they hide.
- such as one using standardized test scores to argue that U.S. high school students are stupid, which neglects that U.S. score is average of all students while the tests for any other nation is average of top 50% or less, as a good fraction of students go to technical schools where they are not subject to the same academic standards [↩]
Peter Schiff was right!
I want you to focus on the statement his detractors made in December 2006. "Housing prices will go up at least 10%".
Now, look at this. If you trust the chart, housing price peaked early 2006. When they were talking about this, housing price was already on the downward slope. (And 2006 also seems to be when Peter Schiff started talking about doom and gloom.)
There is one thing I think that Peter Schiff said that was right but is no longer. "Fundamentals of our economy is not sound". Well, now that I am in the stock market, I think I understand better what is meant by "fundamentals". When the people in stock market talk about "fundamentals", I think they are talking about various ratios that show the fundamental operation and financials of a company, such as price-to-earnings ratio or price-to-book ratio. Before the bubble burst, a lot of companies had high price-to-earnings ratio (in the 50s or 100s; I hear up to 20s or 30s is a "fair" ratio, and anything higher may indicate a buble), as well as high price-to-book ratio. That indicates stock prices unjustified the business operation: i.e. unsound fundamentals.
Since the recession happened (for a lot of companies, Jan 2009 marks the lowest point so far, with many companies slowly recovering), I think fundamentals of many companies have become sound. There are a few property management companies with less than 1 price-to-book ratio (i.e. if they sold all the assets at the nominal value and repaid all the debts and redistributed the remaining equity to stockholders, you would get more than stock price). And quite a few tech, transportation, and banking companies with price-to-earnings ratio at below 10.
While I agree with Schiff that the collapse of manufacturing in America represents a long term problem, I think at least stock markets will recover. And as for manufacturing, well, we still do manufacturing in U.S. Honda and Toyota have plants in U.S. I think there will be much benefit in getting the government out of the business regulating and micromanaging businesses, as Schiff says, but I don't think, after that's done, we are in such a deep hole as he says we are.
AOL does something smart for once
AOL is doing something smart: picking up talents during recession
"David Weir writes on Bnet that the thousands of journalists being let go from newspapers, magazines, and television networks have increasingly been showing up on AOL's payroll — over 1,500 in the last eighteen months — a number AOL expects to double or even triple over the coming year. 'Over time, talent is a fixed cost,' says Marty Moe, Senior Vice-President of AOL Media. 'You can syndicate it, distribute it as you scale. Furthermore, we are already the largest branded content company in the US, with an audience of 75 million domestic uniques. At our size, we can leverage the cost of our publishing and content management systems along with the talent and make the whole thing do-able on an advertising model.' Weir writes that AOL's turnaround started three years ago via the acquisition of Weblogs, Inc., and its set of branded verticals, including Engadget in technology, Autoblog covering the auto industry, and Joystiq covering gaming."
Assuming that they can afford a long-term strategy, this sounds like a good long-term strategy as long as they can make sure that they are hiring talents at ... appropriate salaries (i.e. slackers for slacker salary, and the rare geniuses at recession bargain salary).
Too bad AOL and Time Warner hasn't split ties yet—it doesn't look like I can buy AOL stock without investing in that detestable TIME magazine.