P017 The Life and Death of Democracy from 03/16/2013
Here I am opening up to the idea that democracy and freedom may actually be tied to one another in a mutually supporting relationship and I ask why this might be so - later I develop the idea that there cannot be meaningful freedom unless anyone who is so inclined may take advantage of the possibility of participating in the political competition for opinion leadership and political clout:
Freedom and democracy form a tense relationship. Isonomia, equality before the law – that precursor and beginning of the rule of law – gives rise to a desire to further strengthen this firewall against tyrannical domination: democracy is added to it, as a means of controlling rulers and permitting a bloodless change of government.
Why is it that there seems to be a continuing affinity that ties together the rule of law, a comparatively high degree of personal and economic freedom, and democracy.
A vague suspicion: practises characteristic of the rule of law, personal and economic freedom are protected by a subset and intersecting set of rights equally requisite to maintain democracy. In order to keep democracy alive one mustn’t undermine these common rights. Though democracy may be popular because it opens up options to act in ways that can be directed against freedom, still continued effectiveness of democracy is wedded to the need to respect rights that lend a certain robustness to freedom, too.
P018 Served Well for the Benefit of the Server from 06/13/2013
The political scientist Munger wonders why we are all doing so well without being pawns on the chess board of a dictator. While his account of the role of markets in our productive and peaceable circumstances is valuable, in his major thesis Munger is doubly wrong. His central claim is:
"... markets create interdependencies without forcing subjugation ..."
To begin with, in market economies there is a lot of subjugation going on. Subjugation is allowed or even decreed (a) on the legal meta level and (b) as part of the game defined by the legal meta rules. The peaceableness and fairness of interaction ("interdependencies") in the market is achieved by legal restrictions on fraud and coercion which themselves are coercive. Yet these coercive prescriptions are chosen to lift the overall level of benefits for society at large compared to coercive practices designed to give an advantage to the martially stronger. Markets are instrumental in consummating the objective of peaceful productivity, they are not the origin of it. Legal arrangements assume the role of originator, and law is ultimately the upshot of political ambitions and institutions.
Also, subjugation is not only instituted at the meta level - e.g. allowing incarceration of fraudulent merchants - but is legitimised on the operational level of markets by tolerating activities intended to impose severe harm on one's competitors such as causing their insolvency.
Again, the politically derived and constantly politically revised legal framework of markets does not abolish coercion/subjugation but replaces dysfunctional forms of coercion with forms presumed to be less dysfunctional or productive of net benefits that justify certain types of coercion.
Writes Munger:
Why don't stores charge us exorbitant prices? Why don't our
employers always withhold our health insurance, or cut our salaries in
half, or cancel our vacations? Why do we get pay raises, instead of pay
cuts? Is it because everyone loves us?
So many people I encounter, smart people, seem to believe that what
makes people do good, or prevents them from cheating or acting badly, is
personal integrity, good character, and regard for others. I'm not a
psychologist, but I wonder if the reason is that they just have trouble
with the idea of an intricately interconnected world where all of us are
dependent on unknown others.
How can we be dependent on others, and not
be in their power?
The answer—markets create interdependencies without forcing
subjugation, or even allowing abuse—was one of the key insights of Adam
Smith in The Wealth of Nations. He said:
"Observe the accommodation of the most common artificer or day-labourer
in a civilized and thriving country, and you will perceive that the
number of people of whose industry a part, though but a small part, has
been employed in procuring him this accommodation, exceeds all
computation."
In advanced market economies, we are all dependent on
others in ways we may not even have thought of.
Of course, I would prefer the "Everyone loves Mikey!" explanation. If I
am treated well, it should be because I am special. The fact that
markets create dependencies without subjugation means that I am served well for the benefit of the server; other market participants are prevented from treating me badly not by their good character but by their desire for profits.
The source.*
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Continued here.
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