"The Conversation"

By now, if you've been reading the economic blogosphere lately, you are certainly full to the gills of hearing people talk about the broader implications of the so-called Bleeding Heart Libertarianism of Matt Zwolinksi and David Tomasi. (If not, here's a link to the whole conversation.)

Now that most of the fireworks are over and the rest of us are left taking pot shots after the fact, it has occurred to me that this whole conversation already happened more than a century ago.

In Capitalism: The Unknown Ideal, Ayn Rand pointed out what an utter failure it was on the part of those who adhered to capitalism that they were unable to present a cogent moral theory to contrast against socialism. She rather brutally excoriated the capitalists of the 18th Century for largely capitulating to an almost completely altruistic sense of morality. I could dig up dozens of quotes from this book, but I certainly need not. The very purpose of that book in the first place was to attempt to correct this shortcoming on the part of the capitalists.

In Rand's world, if one accepts the premise that the final cause of morality is altruism, then one has accepted socialism hook, line, and sinker. I myself wouldn't go that far. Why not? Two reasons I guess: First, because morality is complex and largely subjective, and there are plenty of altruists who believe in capitalism; Second, because there are many, many reasons why a free market is the best way to get things done, and it would be foolish to call a whole category of such reasons a capitulation to people who don't understand the shortcomings of statism.

Nonetheless, Rand made a compelling case for considering more than just moral altruism when selecting economic systems. Rand made appeals to our senses of justice and reason. These are important components of morality, and certainly ought to be considered when selecting a good economic system. And it is doubtless true that economists lost their sense of philosophy - and especially a certain richness and diversity in their sense of ethics - somewhere along the way.

If I had to guess, I'd suggest that economists were placed in a situation where they were routinely called on to respond to the socialist critique of capitalism. They tailored their arguments to the audience. The audience wanted to know why it should be considered ethical to pursue capitalism when their sense of altruism made socialism such a compelling policy. The economists responded, "Well, if you really want to help people, then consider the fact that free markets better-provide for the poor than command economies do." All subsequent justifications for capitalism became another verse added to this same song.

At the same time, economics was evolving into a more technical discipline. Economists had less time to wax philosophical and instead had to focus on the specific quantitative claims of the Neo-Classicists, the Currency School, the Keynesians, and so forth. The question of for- or against-socialism fell by the wayside. The really interesting questions pertained to how best to analyze the newly evolving financial economy.

Yet, how interesting is it that economics has once again returned to this very old question?

"Bleeding-Heart Libertarianism" isn't a new concept, it's an old one. Zwolinski and Tomasi readily admit this. Nevetheless, what good can possibly come of readdressing all these old economic conversations, and re-branding them with new buzzwords (other than to sell a lot of copies of Z&T's forthcoming book)?

Sometimes society's short collective memory is dismaying.