Closing Thoughts

As our conversation draws to a close (at least within the context of this forum), areas of disagreement unsurprisingly remain. Matthew Yglesias and I disagree as to whether the theoretical case for free-market solutions is systematic or piecemeal; Steve Horwitz and I disagree on the extent to which Wal-Mart and similar firms owe their success to government intervention; Dean Baker and I disagree about the relative merits of reformism versus abolitionism (he’s worried about making the perfect the enemy of the good, while I fear that gradualism in theory is perpetuity in practice – though for the record I do agree with Baker that his reformist proposal would be preferable to the current system).

But we can all agree that there are a lot of government policies that systematically promote corporatism, that these policies are often cloaked in deceptive free-market rhetoric, and that we need more cooperation and dialogue between libertarians and the left on these matters.

As regards strategies for addressing the problem, we may or may not agree on which politicians to vote for, which concrete policy reforms to support, or whether to work within the political system at all. But there is one all-purpose strategy to which we can all usefully contribute, regardless of which further approaches we favor – namely to get the word out. We don’t have to keep letting either nominally pro-market or nominally anti-market propagandists get away with conflating corporatist policies with free-market ones. The more loudly and consistently we explain the distinction, point out instances of conflation, and delineate the ways in which government policies directly or indirectly prop up big business, the harder we can make it for corporate interests to use the language of free enterprise to gain political privilege.

Also from this issue

Lead Essay

  • In this month’s lead essay, philosopher and libertarian theorist Roderick T. Long draws a sharp contrast between corporatism and libertarianism properly understood. He argues that liberals, conservatives, and even libertarians have all been guilty to some degree of obscuring this difference, and that the quality of our political discourse has suffered accordingly. He suggests that libertarians should guard themselves against falling into the trap of “vulgar libertarianism,” in which all things good spring from business, and particularly from business as usual. Corporations, he argues, should be no more free from scrutiny than any other institution in society, and often businesses have done more than their share to hamper free economic relations in the industrialized world.

    One implication of all of this is that the truly free market is farther away than we imagine. Long suggests several ways in which a freed market would be different from what we see around us today. Notably, nearly all of these differences are to the benefit of the consumer and the small or start-up business. These likely outcomes of laissez faire suggest new grounds for left-liberals and libertarians to revise their thinking on economic issues and on politics more generally.

Response Essays

  • In his response to Long, Matthew Yglesias argues that although corporations naturally seek to win special privileges from the state, libertarianism is far from the obvious solution to the problem. Instead, he reiterates the charge that libertarians often act as corporate apologists and suggests that the net effect of any “free market” advocacy will tend strongly toward corporate power. Liberals may have much to learn from libertarians on certain issues and in some policy areas, but the laissez-faire solution to corporate political influence is unworkable.

  • Steven Horwitz offers several examples of so-called “de-regulation” that only served to benefit corporations, while leaving the government, and therefore the taxpayers, to shoulder the risks of the market. He argues that market competition is a form of regulation, albeit a kind worth wanting, as it forces corporations to respond to consumer demand and punishes them when they fail to meet it. He takes issue with Long’s lead essay by arguing that “playing defense,” that is, defending today’s corporations when they act consonantly with a fully freed market, is a valuable part of libertarian advocacy. One must nonetheless take issue with these same corporations when they violate the principles of laissez faire and distinguish carefully between these cases.

  • In his response essay, Dean Baker declines to tally up a “score” of how well libertarians, or other groups, have defended a truly impartial, laissez faire economy. Instead, he suggests intellectual property as an obvious area where libertarians must challenge corporate power to distort the market. Patents that make health care more expensive and copyrights that artificially restrict whole areas of our culture are obviously concessions to corporatism, and the “extraordinary abuses” undertaken to enforce these privileges should be vigorously challenged. Although libertarianism has been skeptical of both patents and copyrights, Baker suggests that this is an area deserving still further attention, and one in which liberals could perhaps become solid allies.

  • The discussion this month has focused to a greater than usual degree on the activities of certain Cato Institute policy scholars. The editors thought it appropriate to solicit responses, and we present them here in their entirety.