November 17, 2013

The World of English Freedoms

Though the author ends by focusing on the future of India, he makes some very insightful observations about the nature of America's exceptionalism. For me, the key paragraphs are these:
At a time when most countries defined citizenship by ancestry, Britain was unusual in developing a civil rather than an ethnic nationality. The U.S., as so often, distilled and intensified a tendency that had been present in Great Britain, explicitly defining itself as a creedal polity: Anyone can become American simply by signing up to the values inherent in the Constitution.
There is, of course, a flip-side. If the U.S. abandons its political structures, it will lose its identity more thoroughly than states that define nationality by blood or territory. Power is shifting from the 50 states to Washington, D.C., from elected representatives to federal bureaucrats, from citizens to the government. As the U.S. moves toward European-style health care, day care, college education, carbon taxes, foreign policy and spending levels, so it becomes less prosperous, less confident and less free.
We sometimes talk of the English-speaking nations as having a culture of independence. But culture does not exist, numinously, alongside institutions; it is a product of institutions. People respond to incentives. Make enough people dependent on the state, and it won't be long before Americans start behaving and voting like…well, like Greeks.
Success in a republic -- especially in ours, where foundational principles included the propositions that citizens were expected to be responsible for themselves and their condition, that the individual states would be the principle means by which the citizenry would govern itself, and that the federal government would attend only to those duties that individuals and the individual states were structurally incapable of addressing (e.g. defense of the nation) -- demands a strong measure of self-discipline exercised by both the citizenry and the government and sufficient interest by that citizenry in political affairs that it is willing and able to hold its government to account when policies pose dangers to the long-term health and viability of the Republic. Currently, the majority of our citizenry is 'uninterested' and 'unwilling' and seems more inclined to increase the provision of federally-dispensed goodies even at the expense of the longterm health of our country. I hope the rapidly unfolding 'Affordable Care Act' debacle is sufficient to rouse people to action but our recent history doesn't make me very optimistic. Pity.

The World of English Freedoms

It's no accident that the English-speaking nations are the ones most devoted to law and individual rights, writes Daniel Hannan

Nov. 15, 2013 6:17 p.m. ET

Asked, early in his presidency, whether he believed in American exceptionalism, Barack Obama gave a telling reply. "I believe in American exceptionalism, just as I suspect the Brits believe in British exceptionalism and the Greeks believe in Greek exceptionalism."

The first part of that answer is fascinating (we'll come back to the Greeks in a bit). Most Brits do indeed believe in British exceptionalism. But here's the thing: They define it in almost exactly the same way that Americans do. British exceptionalism, like its American cousin, has traditionally been held to reside in a series of values and institutions: personal liberty, free contract, jury trials, uncensored newspapers, regular elections, habeas corpus, open competition, secure property, religious pluralism.

The conceit of our era is to assume that these ideals are somehow the natural condition of an advanced society—that all nations will get around to them once they become rich enough and educated enough. In fact, these ideals were developed overwhelmingly in the language in which you are reading these words. You don't have to go back very far to find a time when freedom under the law was more or less confined to the Anglosphere: the community of English-speaking democracies.

In August 1941, when Franklin Delano Roosevelt and Winston Churchill met on the deck of HMS Prince of Wales off Newfoundland, no one believed that there was anything inevitable about the triumph of what the Nazis and Communists both called "decadent Anglo-Saxon capitalism." They called it "decadent" for a reason. Across the Eurasian landmass, freedom and democracy had retreated before authoritarianism, then thought to be the coming force. Though a small number of European countries had had their parliamentary systems overthrown by invaders, many more had turned to autocracy on their own, without needing to be occupied: Austria, Bulgaria, Estonia, Germany, Greece, Hungary, Italy, Latvia, Lithuania, Poland, Portugal, Romania, Spain.

Churchill, of all people, knew that the affinity between the United States and the rest of the English-speaking world rested on more than a congruence of parliamentary systems, and he was determined to display that cultural affinity to maximum advantage when he met FDR.

It was a Sunday morning, and the British and American crewmen were paraded jointly on the decks of HMS Prince of Wales for a religious service. The prime minister was determined that "every detail be perfect," and the readings and hymns were meticulously chosen. The sailors listened as a chaplain read from Joshua 1 in the language of the King James Bible, revered in both nations: "As I was with Moses, so I will be with thee: I will not fail thee, nor forsake thee. Be strong and of a good courage."

The prime minister was delighted. "The same language, the same hymns and, more or less, the same ideals," he enthused. The same ideals: That was no platitude. The world was in the middle of the second of the three great global confrontations of the 20th century, in which countries that elevated the individual over the state contended for mastery against countries that did the opposite. The list of nations that were on the right side in all three of those conflicts is a short one, but it includes the Anglophone democracies.

We often use the word "Western" as a shorthand for liberal-democratic values, but we're really being polite. What we mean is countries that have adopted the Anglo-American system of government. The spread of "Western" values was, in truth, a series of military victories by the Anglosphere.

I realize that all this might seem strange to American readers. Am I not diluting the uniqueness of the U.S., the world's only propositional state, by lumping it in with the rest of the Anglosphere? Wasn't the republic founded in a violent rejection of the British Empire? Didn't Paul Revere rouse a nation with his cry of "the British are coming"?

Actually, no. That would have been a remarkably odd thing to yell at a Massachusetts population that had never considered itself anything other than British (what the plucky Boston silversmith actually shouted was "The regulars are coming out!"). The American Founders were arguing not for the rejection but for the assertion of what they took to be their birthright as Englishmen. They were revolutionaries in the 18th-century sense of the word, whereby a revolution was understood to be a complete turn of the wheel: a setting upright of that which had been placed on its head.

Alexis de Tocqueville is widely quoted these days as a witness to American exceptionalism. Quoted, but evidently not so widely read, since at the very beginning of "Democracy in America," he flags up what is to be his main argument, namely, that the New World allowed the national characteristics of Europe's nations the freest possible expression. Just as French America exaggerated the autocracy and seigneurialism of Louis XIV's France, and Spanish America the ramshackle obscurantism of Philip IV's Spain, so English America (as he called it) exaggerated the localism, the libertarianism and the mercantilism of the mother country: "The American is the Englishman left to himself."

What made the Anglosphere different? Foreign visitors through the centuries remarked on a number of peculiar characteristics: the profusion of nonstate organizations, clubs, charities and foundations; the cheerful materialism of the population; the strong county institutions, including locally chosen law officers and judges; the easy coexistence of different denominations (religious toleration wasn't unique to the Anglosphere, but religious equality—that is, freedom for every sect to proselytize—was almost unknown in the rest of the world). They were struck by the weakness, in both law and custom, of the extended family, and by the converse emphasis on individualism. They wondered at the stubborn elevation of private property over raison d'├ętat, of personal freedom over collective need.

Many of them, including Tocqueville and Montesquieu, connected the liberty that English-speakers took for granted to geography. Outside North America, most of the Anglosphere is an extended archipelago: Great Britain, Ireland, Australia, New Zealand, Hong Kong, Singapore, the more democratic Caribbean states. North America, although not literally isolated, was geopolitically more remote than any of them, "kindly separated by nature and a wide ocean," as Jefferson put it in his 1801 inaugural address, "from the exterminating havoc [of Europe]."

Isolation meant that there was no need for a standing army in peacetime, which in turn meant that the government had no mechanism for internal repression. When rulers wanted something, usually revenue, they had to ask nicely, by summoning people's representatives in an assembly. It is no coincidence that the world's oldest parliaments—England, Iceland, the Faroes, the Isle of Man—are on islands.

Above all, liberty was tied up with something that foreign observers could only marvel at: the miracle of the common law. Laws weren't written down in the abstract and then applied to particular disputes; they built up, like a coral reef, case by case. They came not from the state but from the people. The common law wasn't a tool of government but an ally of liberty: It placed itself across the path of the Stuarts and George III; it ruled that the bonds of slavery disappeared the moment a man set foot on English soil.

There was a fashion for florid prose in the 18th century, but the second American president, John Adams, wasn't exaggerating when he identified the Anglosphere's beautiful, anomalous legal system—which today covers most English-speaking countries plus Israel, almost an honorary member of the club, alongside the Netherlands and the Nordic countries—as the ultimate guarantor of freedom: "The liberty, the unalienable, indefeasible rights of men, the honor and dignity of human nature... and the universal happiness of individuals, were never so skillfully and successfully consulted as in that most excellent monument of human art, the common law of England."

Freedom under the law is a portable commodity, passed on through intellectual exchange rather than gene flow. Anyone can benefit from constitutional liberty simply by adopting the right institutions and the cultural assumptions that go with them. The Anglosphere is why Bermuda is not Haiti, why Singapore is not Indonesia, why Hong Kong is not China—and, for that matter, not Macau. As the distinguished Indian writer Madhav Das Nalapat, holder of the Unesco Peace Chair, puts it, the Anglosphere is defined not by racial affinity but "by the blood of the mind."

At a time when most countries defined citizenship by ancestry, Britain was unusual in developing a civil rather than an ethnic nationality. The U.S., as so often, distilled and intensified a tendency that had been present in Great Britain, explicitly defining itself as a creedal polity: Anyone can become American simply by signing up to the values inherent in the Constitution.

There is, of course, a flip-side. If the U.S. abandons its political structures, it will lose its identity more thoroughly than states that define nationality by blood or territory. Power is shifting from the 50 states to Washington, D.C., from elected representatives to federal bureaucrats, from citizens to the government. As the U.S. moves toward European-style health care, day care, college education, carbon taxes, foreign policy and spending levels, so it becomes less prosperous, less confident and less free.

We sometimes talk of the English-speaking nations as having a culture of independence. But culture does not exist, numinously, alongside institutions; it is a product of institutions. People respond to incentives. Make enough people dependent on the state, and it won't be long before Americans start behaving and voting like…well, like Greeks.

Which brings us back to Mr. Obama's curiously qualified defense of American exceptionalism. Outside the Anglosphere, people have traditionally expected—indeed, demanded—far more state intervention. They look to the government to solve their problems, and when the government fails, they become petulant.

That is the point that much of Europe has reached now. Greeks, like many Europeans, spent decades increasing their consumption without increasing their production. They voted for politicians who promised to keep the good times going and rejected those who argued for fiscal restraint. Even now, as the calamity overwhelms them, they refuse to take responsibility for their own affairs by leaving the euro and running their own economy. It's what happens when an electorate is systematically infantilized.

The owl of Minerva, wrote Hegel, spreads its wings only with the gathering of the dusk. Since the middle of the 18th century, the hegemony of the English-speaking peoples has drawn many other nations into a uniquely free, democratic and wealthy world order. The Anglo-American imperium is, by most measures, reaching its twilight. But the values of the Anglosphere, particularly the unique emphasis on individualism, ought to be perfectly suited to the Internet age. And such values can take root anywhere.

Perhaps the most important geopolitical question of the 21st century is this: Will India define itself primarily as a member of the Anglosphere or as an Asian power? In the decades after independence, India did what all former colonies do, adopting policies aimed at underlining its differences from the former occupier. Successive governments promoted autarky, the Hindi language and equidistance between the Western and Soviet blocs.

But India has long since passed its moment of maximum orbital distance from the other Anglophone democracies. The traits that continue to set it apart from most of its neighbors are, for want of a better shorthand, Anglosphere characteristics.

In India, governments come and go as the result of elections, without anyone being exiled or shot. The armed forces stay out of politics. English is the language of government and of most universities and businesses. Property rights and free contract are secured by a common-law system, which remains open to individuals seeking redress. Shared values lead to shared habits. When, in the aftermath of the tsunami 10 years ago, the U.S., Australian and Indian navies coordinated the relief effort, they found an interoperability that goes beyond even that found among NATO allies.

If India were to take its place at the heart of a loose Anglosphere network, based on free trade and military alliance, the future would suddenly look a great deal brighter. Of course, to join such a free trade area, the U.K. and Ireland would have to leave the EU. But that's another story.

Mr. Hannan has represented South East England in the European Parliament since 1999. This essay is adapted from his new book, "Inventing Freedom: How the English-Speaking Peoples Made the Modern World," which has just been published by HarperCollins.

September 29, 2013

On Decadence - Charles Hill, The American Interest

I know I'm crossing a line in posting this article because the story at the link is behind a subscription pay wall; consequently, you should be a subscriber to view it. But I think this is such a superb item that I really do hope that by sharing it you, dear reader, will find the same wonderful insight I found, enjoy the same sublime gift in Hill's writing style and clarity of thought, and (I hope) find it of sufficient value to actually subscribe the The American Interest. I've had the great pleasure of working with Adam Garfinkle, the Editor at TAI, on a couple of articles and he was always the epitome of what you would expect an editor to be: supportive, encouraging, prodding for completion, sound advice. His blog is here. He does a marvelous job at assembling an array of quality essays for each bi-monthly issue. Please check it out.

As for Hill's article, when you've finished reading it -- and you'll need to set aside some time to do so -- you'll find yourself thinking, "But of course! It all makes so much sense." Hill addresses, and echoes, the concern of George Washington regarding the necessity and challenge of "maintaining the character of the nation amid the temptations of freedom." He walks the reader through the evolution of how society's appreciation of virtuous living is constantly challenged by the opportunities for mischief presented by increasing liberty for the individual and freedom for our society as a whole. He discusses the corrosive aspects of our "Age of Entertainment," the "Great Virtue Shift" of the last few decades where vices have become virtues, and how our government itself has shifted as officials respond "to the changing psychology and national character of the country." 

Per Hill, "Throughout most of American history people were preoccupied with how to prevent government from becoming corrupt. In our time, governments have discovered how to corrupt the people. It then follows that the more corrupted the people become, the more numerous the laws must be, thus further aggrandizing government’s indispensability." Hill brings it all together in his concluding paragraphs where he emphasizes and ties together freedom, liberty, and the essential, enabling virtue of self discipline...all rooted in a strong foundation of religious belief. 
"It comes down, finally, to the individual and to George Washington’s recognition that a free society must be made up of virtuous, self-disciplined citizens. [...] Americans possess liberty as do no others and so have sought to understand its uses and responsibilities as well as the myriad of ways, direct or insidious, through which it can be taken away. Freedom is for a people; liberty is for the individual. So if liberty must be limited in order to be possessed, it must be self-imposed in the recognition that certain limits are essential to making one’s actions effective, intellectually coherent and even possessed of a certain beauty. [...] To the main point of Washington’s Farewell Address...Tocqueville added that in America, uniquely, religion and liberty are compatible: Freedom sees religion as the cradle of its infancy and the divine source of its rights, while religion is the guardian and guarantee of the laws that preserve liberty. But at the same time...American liberty has been endangered by the American “passion for regulation.” This, Tocqueville predicted, eventually would enable government to extend its arms over society as a whole, to cover its surface “with a network of small, complicated, painstaking, uniform rules through which the most original minds and the most vigorous souls cannot clear a way.” [...] ...a lack of self-limitation on individual liberty will produce excess and coarseness; virtue will retreat and, as it does, hypocritical moralizing about society’s deficiencies will increase. Widening irresponsibility coupled with public pressure for behavior modification will mount and be acted upon by government. The consequential loss of liberty scarcely will be noticed by the mass of people now indulging themselves, as Tocqueville predicted, in the “small and vulgar pleasures with which they fill their souls.” We will not as a result be ruled by tyrants but by schoolmasters in suits with law degrees, and be consoled in the knowledge that we ourselves elected them. [...] To retain liberty, or by now to repossess it, Americans must re-educate themselves in what has been made of Burke’s precept: “Liberty must be limited in order to be possessed.” Walt Whitman re-formulated this as, “The shallow consider liberty a release from all law, from every constraint. The wise man sees in it, on the contrary, the potent Law of Laws.” Learning what liberty is and what it requires of us is the only bulwark, ultimately, against American decadence."
In short, if we as a people and as individuals cannot exercise self-discipline derived from the virtues provided by our religious convictions, then our "coarseness" as a society will increasingly result in additional layers of government intrusion and regulation upon which we will continue to be increasingly dependent until we finally arrive at a state where all liberty is lost and government power is absolute. A free society is a virtuous society, one that is serious about what it takes to maintain such and is always on guard against those influences that constantly seek to erode its character. It is time for us to once again be a serious people. 

From the September/October 2013 issue:

On Decadence

ecline” we Americans and Westerners mope about daily; “fall” most of us still hope to postpone. Decadence, it would seem, is the mean between the two.
The much-overused decline and fall trope, fixed permanently into our abstract vocabulary ever since Edward Gibbon’s Decline and Fall of the Roman Empire took a then-experimentally post-Christian Western Europe by storm, was meant to demonstrate the mortality of all human constructions. Oddly enough, however, Gibbon did it in spite of the Enlightenment’s discovery of progress by retreating to the oldest trope of all—the cyclical, organic metaphor of birth, growth, decay, death. Much of the 19th century was spent trying to reconcile progress with the cyclical via the uses and abuses of Darwin. In the 20th century, Oswald Spengler, Arnold Toynbee and Paul Kennedy rejoined that intellectual dispute, traceable to remote antiquity: Either the human condition is cyclical, like the seasons and the life cycle, or it is linear, starting someplace, going someplace, with a positive goal ahead. 

September 12, 2013

American Exceptionalism

My go-to source for news of "the world's major wars, conflicts...military, political, and intelligence" issues is War News Updates, a blog edited by a fellow of Russian ancestry who currently lives in Canada. He does a remarkable job of posting articles throughout the day, occasionally adding his own comment. I mention this because of all the hubbub created by the Putin Op-Ed piece in yesterday's New York Times.  Pundits from across the political spectrum have weighed in on various aspects of it with perhaps the most attention paid to Putin's dismissive comment about "American exceptionalism." There are so many items about America, what it stands for, what it has contributed to the world, the hope it has brought to millions, the burden it has borne on behalf of so many who were unable, or unwilling, to do so on their own that I would scarcely know where to start...but then there's this...the comment posted today from the Russian-Canadian editor of WNU:
"As to what is my take on American exceptionalism .... read the following.
Being one who grew up in the former Soviet Union .... and who now lives in Canada but travels to the U.S. all the time .... I think I have a certain perspective on American exceptionalism that I know that Russian President Putin does not have ... and .... I sometimes wonder .... if President Obama and most Americans still believe in.
American exceptionalism is not because America was and is made up of special people. Or (as some believe) that God has chosen the American people. It is certainly not because of it's national and international policies ... nor of the good deeds that Americans are always trying to do.
American exceptionalism is the following ..... throughout history mankind has always lived under (and been subjected to) despots and tyranny that made survival the primary goal of everyone .... with the exception of the rulers. But the founding of America broke .... for the first time .... this state of affairs. In short .... the U.S. was founded by men who believed that leaders must serve the people .... and not the other way around .... and to insure that this will not change a constitution was then set up and enshrined in law on how this government was to function .... and more importantly .... enshrining in law the freedom and liberty that individuals will have in such a nation..
Yup .... liberty and freedom codified by law is what made America exceptional .... not the power and might of it's government.
As to Putin's comments that God created us equal .... the framers of the constitution understood this .... hence enshrining in the constitution a political framework that was codified by law that acknowledges God's creation.
President Putin as a former communist does not understand this. President Obama .... when I listen to his comments on negative liberties .... certainly does not. And sadly .... most of the world certainly does not.
But people worldwide have always found this topic to be a fascinating one to talk about .... and in my travels to places in Asia and Europe I have always found myself getting into these discussions. Interestingly .... these debates always ended when I made the following observation. Culturally .... Europe and Asia are centuries ahead of the U.S. .... if not more. Their history is rich with thousands of years of life experiences .... something that a young nation like America cannot even hope to compare to. But .... when looked at politically .... America is the giant and the old wise man while all of these old nations are just juvenuiles struggling only now to attain those concepts of freedom and liberty that we in North America have take for granted for the past two centuries."
Why is it that some of the best commentary on the exceptionalism of America comes from people who aren't Americans, or at least weren't so originally? I think it's because people who have grown up outside of America have experienced first-hand a vastly different reality than most Americans can even begin to understand. For many (most?) of those living somewhere other than America, daily reality includes oppressive governments, few personal freedoms, limited opportunities, and subsistence living. It includes an enduring concern for personal safety and, for many, resignation to whatever socio-economic status they were born into. Here in America, the vast majority of us have known nothing but personal liberty, the opportunity to pursue whatever we desired (whether we take advantage of those opportunities is an entirely different matter), a complete absence of true fear of authorities, the ability to come and go as we please, and to say pretty much whatever we want to, whenever we want to, with no fear of consequence. Long stretches of national peace, ease, relative comfort, comparative wealth--the list goes on--tend to lull people into a false sense that things have always been and will always be this way at little personal cost. Like subsisting on charity for a long stretch of time with no obligation to repay it in any way, even through community service, the recipient grows to feel entitled to such, gets resentful when called upon to 'pay up,' and seeks the cover of sympathetic patrons when the 'easy times' are threatened. Nationally, we are teetering on the edge of such a condition. For almost a quarter century now, since the dissolution of our global opponent, the Soviet Union, we have extended benefit upon benefit to our citizenry and have asked for almost nothing in return. Our living has been good, perhaps too good. But now competitors challenge us at every turn. The 'daily reality' of much of the world begins to affect us here at home. At a moment when strength is needed, we find ourselves riddled with debt, unmoored from our founding principles, and cynically suspicious of our own government.

Make no mistake - our system is still the best there is. It possesses the greatest inherent resilience, provides for the greatest opportunity for the greatest number of people, facilitates the transfer of power from one group to the next without bloodshed, enables the greatest participation in the process limited only by the interest of our citizenry to participate in the first place. Our system is able to easily trounce any other in the world because of the inherent failings of the others. In fact, the only real threat to America comes from inside America and that threat stems from the apathy of its citizens. If you don't care enough to take an interest and get involved, don't be surprised if you wake up one day to find the world you remembered has been replaced by another that's hungrier, more ambitious, and more confident in itself. In the end, it really is up to us.

September 11, 2013

Neil Cavuto looks back on the anniversary of 9/11

While driving home from work this evening, I heard a wonderful item from Neil Cavuto who was sharing his thoughts on this 12th anniversary of 9/11. I don't know why but it really stuck with me, perhaps because I only heard the audio while driving alone and the effect wasn't lessened, in a sense, by the video setting. When you just have to listen, you can picture different things in your mind's eye. Maybe it's best to just close your eyes and listen while it plays. Either way, I liked his perspective and the points he was making -- we just never know when life will take it's dramatic turns and only after such moments do we truly realize what we habitually take for granted.

Here's a link to the video.

September 8, 2013

Information Theory and Capitalism

Hard to believe it's been almost two months since my last post. "Life" does have a way of imposing itself  such that we all need to prioritize our allocation of time, attention and effort. Clearly this blog has taken a lesser place when balanced against family time and even work, though I try to limit the amount of work that comes home with me. Another contributing factor has to do with my desire to share things that I hope are value-added or to spend time here at the keyboard on material of sufficient interest (even if only to me) that warrants not spending the time doing something spending it with family. We are awash with news reports, commentaries, the hyperactivity of the blogosphere, an unending stream of televised and broadcasted punditry and, thank goodness, the occasional really good article in print media all hard at work dissecting, analyzing, and critiquing the issues of our day. Why just add to the noise? Snowdengate, Obamacare, the Benghazi debacle, an out-of-control IRS, a dysfunctional Congress, continued turmoil in the Middle East (shock), amateur-hour-theatrics over whether to strike Syria, the latest starlet going into or coming out of rehab...these are covered ad nauseum.  If you are taking the time to read this blog, you are highly likely to be the type of person who already tracks current events and takes more than a moment to reflect on their implications and the various factors that converge to create such situations in the first which case I'd like to provide material you might not otherwise have read during the week. After all, it's not as if I'm trying to entice readership with fantasy league stats, photos of the new royal baby, or commentary on the dating techniques of the newly-graduated-but-not-yet-employed-who-still-live-with-parents-cohort.

With this in mind, I'd like to direct your attention to a superb article published in a recent issue of The Weekly Standard. The item, a four page article entitled "Surprise and Creativity," by George Gilder, is a fascinating overview of Information Theory as the basis for a new economics theory for Capitalism. Yes, yes, I know..."fascinating" in the same sentence as "theory," "economics," and "capitalism"? It doesn't carry quite the emotional high that you get when you see your favorite team beat its arch-rival in overtime but stick with me on this. I think what Gilders is saying is profoundly important for this reason: at the root of any substantive policy lies some sort of strongly-held belief by the person(s) who crafted and implemented the policy...some conviction that a given approach to an issue is most likely to achieve a desired objective or outcome. 

For socialists, the conviction is that production should directly and immediately satisfy needs (of the market or the individual person) rather than the private accumulation of wealth. Therefore, Socialists seek to centrally control resources and dictate production and distribution instead of allowing individuals to do so and for the market, writ large, to determine prices, availability, market penetration, etc. Different religions have different central imperatives that drive implementation of their doctrines. Some belief systems compel adherents to impose their system on others while other systems are quite "hands off." The stewardship of natural resources even finds wildly different expression based on the underlying beliefs of different people--some believing that the "natural condition" of the environment takes priority over the material progress of humans while others are just as firmly convinced that Man has every right to use what nature has to offer in pursuit of material advances. In all these cases, such beliefs can shape the policies that governments adopt and impose on their citizens. We have seen the relentless march of Socialism in Europe whereby governmental (local, state, national), super-governmental (European Union), and extra-governmental (e.g. the European Commission) regulatory bodies dictate that how, when, where, and why of economic policies for all member states and their citizens. Islam, as it is being practiced throughout much of the Middle East, seeks to impose its view of "right conduct" by force, necessarily at the expense of the beliefs of other populations such as Christians or even competing sects within Islam (Sunni vs. Shia). Those who believe the industrial-age activities of mankind are responsibility for changes in our climate seek to change policies effecting energy production and use. My long-winded point here is that theories actually mean something since they serve as the basis for the policies, laws, and regulations that effect our daily lives. 

What Gilder is proposing is a different way to understand economics, in general, and capitalism in particular. An early and devoted disciple of Irving Kristol, Gilder begins his article with an overview of Kristol's thoughts about economic models, specifically highlighting Kristol's criticism of the prevailing theory of capitalism as "a calculus of simple self-interest and apparently governed by no moral code," that "[in] a democratic such system can ultimately survive." By this, Kristol meant that free-market capitalism and, indeed, a free democratic society should be governed by some sort of morality to reflected the conservative values he did so much to champion. According to Gilder, Kristol posed two key questions for any economic theory: "Can the theory provide a moral or 'transdendental' justification for its results, so that it is politically acceptable" and "can it explain growth and creativity?" Gilder says that the Information Theory of economics does so and therefore should serve as the basis for better understanding, and by extension informing policies for, our government's approach to economic policy. 

Here are some highlights (extracts or paraphrased items) from the article:
- Most economists believe that order and information are kindred concepts...that a successful economy seeks balance or equilibrium between the two.
- "Order," however, is the opposite of information since "information" is essentially news or surprise; information is something new, something unexpected. If you hear something you already know, you haven't learned anything, nothing new has been created. Order, then, is in opposition to this because it seeks to minimize disruptions to the system.
- Gilder's "information theory for economics" should be thought of as human creations viewed as 'transmissions down a channel' in the presence of 'noise' or 'impediments to transmission' with the outcome measured by its 'news' or surprise.
- Businesses conducting entrepreneurial experiments must be allowed to fail; otherwise, nothing is learned from the attempt, no new knowledge is generated and therefore no new wealth is produced. [In other words, you can't really learn any true lessons if outcomes are predetermined.]
- Information Theory places the surprising creation of entrepreneurs and innovators at the very center of the system.
- Information is ultimately a measure of human freedom and thus places such freedom at the heart of the economic model.

So what does all this really mean? I believe it means that wealth comes from creativity (something that is new and unexpected); creativity comes from experimentation; and experimentation is defined by an infinite variety of attempts to find new things and new ways. When "the system" -- i.e. the government -- seeks to dictate preferred outcomes, shape efforts toward desired solutions, or impose burdensome restrictions and impediments on capitalism then entrepreneurialism is stunted, the flow of "information" is reduced ("information" in this sense can be thought of as anything, really -- individual effort, the exchange of ideas, the flow of capital, etc.), working capital is bled-off (in taxes, regulatory compliance, and bureaucratic overhead), and true innovation is quashed. 

Consider some of Gilder's closing thoughts:
No business guaranteed by the government is capitalist.Guarantees destroy knowledge and wealth by eliminating falsifiability [the potential to fail].  Unless entrepreneurial ideas can fail and business go bankrupt, they cannot succeed in creating new knowledge and wealth.
The message of a knowledge economy is optimistic. As Wanniski wrote, "Growth comes not from dollars in people's pockets but from ideas in their heads."...A capitalist economy can be transformed as rapidly as human minds and knowledge can change.
Deeper than economics or social theory, these ideas reflect the most powerful scientific ideas of the era. Information Theory recognizes that information is not order but disorder and that the universe is not a great machine that is inexorably grinding down all human pretense of uniqueness and free will. The uniqueness and free will of humans is indispensable to civilization.
In capitalism, the predictable carriers are the rule of law, the maintenance of order, the defense of property rights, the reliability and restraint of regulation, the transparency of accounts, the stability of money, the discipline and futurity of family life, and a level of taxation commensurate with a modest and predictable role of government.
As Kristol observed, progress in law and order does not spring from a Darwinian process of natural selection among random mutations. Progress stems from political leadership and sacrifice, prudence and forebearance, wisdom and courage. Sometimes these must be defended by military force. They originated historically in a religious faith in the transcendent order of the universe. They embody a hierarchic principle. It is these low-entropy carriers that enable the high-entropy creations of successful capitalism.
What Gilder is getting at is this: when our government uses its regulatory powers to choose winners and losers, when it bleeds capital from the private sector via high taxes and extraordinary levels of public debt, when it imposes layer upon layer of regulation on private business and individuals, and when it takes control of sectors of our economy (health care, for example) it distorts our economy, undermines our entrepreneurs, constrains innovation and creativity, and blunts generation of wealth. And most importantly, an overly active government saps "the uniqueness and free will of humans [that] is indispensable to civilization."

Our government helps most when it does the least necessary to maintain a stable framework within which the creative energies of capitalism are unleashed and the root values of our culture find their full flower. I hope Gilder's new economic theory gains traction and I hope you take a few minutes to read the article for yourself.

July 6, 2013

America - Land That I Love

As one gets older, birthdays become not only a time of celebration, but also a time for reflection. I guess this applies to countries, too, at least that's the feeling I get whenever we celebrate another 4th of July and I see the myriad commentaries on our founding, our current state of affairs, and our various potential futures. A recurring theme that I do love to see is the oft-noted point that America is the only country ever founded on an idea: that people are 'free', created equal by God, and possessing unalienable rights bestowed upon them by God--life, liberty, and the pursuit of happiness. Men should be free to conduct their affairs without undue interference, free to engage in discourse and commerce with whomever they wish, free to take advantage of opportunities to as great an extent as their abilities and ambition might make possible, and free to express and practice their beliefs...all without fear that a government would arbitrarily impose abusive restraints, conditions, or penalties to force compliance with 'acceptable' or 'required' behaviors as determined by the State. 

America's drive for independence was fueled by 'a long train of abuses and usurpations' intended to subject the Colonists to despotic rule. For a very long while, the Colonists desired only to have their complaints heard and addressed by the King; they repeatedly expressed their wish to remain loyal to the Crown but as citizens in equal standing with their fellow Englishman. 
In every stage of these Oppressions We have Petitioned for Redress in the most humble terms: Our repeated Petitions have been answered only by repeated injury. A Prince, whose character is thus marked by every act which may define a Tyrant, is unfit to be the ruler of a free people.
Nor have We been wanting in attentions to our British brethren. We have warned them from time to time of attempts by their legislature to extend an unwarrantable jurisdiction over us. We have reminded them of the circumstances of our emigration and settlement here. We have appealed to their native justice and magnanimity, and we have conjured them by the ties of our common kindred to disavow these usurpations, which, would inevitably interrupt our connections and correspondence. They too have been deaf to the voice of justice and of consanguinity.
'Repeated injury' made clear that the Crown had no intention of honoring the wishes of the people it governed in the New World colonies. This led the Colonists--through hurt, frustration, and anger at the injustices imposed on them--to consider their status, to engage in debate about what it meant to be a 'citizen' in the first place, to consider the implications of what it meant to be created in God's 'likeness', to be 'free Men.' In the end, a drafting committee established by the convened representatives of the several Colonies settled on these words that birthed a new country and that have since served as inspiration for so many other peoples around the world:
We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.
That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness. Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.
Implicit in the work of the delegates was the expectation that 'free men' would act responsibly, that they would be accountable for themselves and their actions (or inactions), just as governments should be accountable to serve the interests of the people from whom they derive their 'just powers'.  The Colonies declared their independence from England because the government refused to be held accountable for its unjust treatment of its subjects. In choosing to establish their own country, the colonists took advantage of the rare opportunity to form a government whose form and function would reflect the ideals outlined in the Declaration. It would take another decade before that government took its final shape but when it did it reflected the sense of independence and personal responsibility implied by the Continental Congress and highlighted by the various writings of the Founding Fathers. 

Some fifty-five years after the Declaration was signed, two young French noblemen, Alexis de Tocqueville and Gustave de Beaumont, arrived at the direction of the French government ostensibly to study the American prison system though their real interest in coming to America was to study the society of this new and vibrant country. Though both men penned volumes based on their observations during the trip, Tocqueville's  On Democracy in America (text here) became the far better known. 

Tocqueville had much to say about his trip to America, in the two volumes of Democracy and in various letters he wrote and talks he gave in the years that followed. He noted that America's greatness extended, in part, from the goodness of its people, but warned that should Americans cease to be good, so too would America cease to be great.
America is great because she is good. If American ceases to be good, America will cease to be great.
Similarly, he rightly connected the liberty enjoyed by Americans and the goodness that informed America's greatness with the idea that God-centered Faith was necessary and essential for the proper workings of both.
Liberty cannot be established without morality, nor morality without faith.
He also noted that personal freedom and the 'unalienable rights' at the center of America's founding documents were crucially dependent on the extent to which citizens took an active and productive role in the functioning of society.
The health of a democratic society may be measured by the quality of functions performed by private citizens.
As I read these and so many other related statements pertaining to the character, quality, vitality, and viability of our country, what it has stood for however imperfectly over its 237 years, and the principles upon which it was founded, I cannot help but also think about the issues facing our country today and the many problems that are afflicting our society, the vast majority of which are self-inflicted.

One commentator has noted that “According to Tocqueville, democracy had some unfavorable consequences: the tyranny of the majority over thought, a preoccupation with material goods, and isolated individuals. Democracy in America predicted the violence of party spirit and the judgment of the wise subordinated to the prejudices of the ignorant.”  Others foresaw these problems, too, because they understood that the strength of our country and the type of government our Founding Fathers knew would best support our 'unalienable rights' also carried the seeds of its undoing. 
Upon leaving Independence Hall on the closing day of deliberations by the Constitutional Convention, Benjamin Franklin responded to a women who asked, “Well, Doctor, what have we got—a Republic or a Monarchy?” with “A Republic, if you can keep it.” 
Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other. ~ John Adams 
Sustaining our great and good country demands the active and informed participation of our citizenry on a consistent basis and for our citizenry to choose to manifest the principles enshrined in our Declaration and reflected in the form of government stipulated in our Constitution, especially those that are implied: personal responsibility and accountability, the exercise of self-discipline, individual behavior guided by a closely held moral code that is itself rooted in one's conviction of a higher guiding Authority, and the courage to hold elected officials accountable when they hold their own interests above those of their country and fellow citizens.

During the 2012 political season, I had occasion to be involved in a political campaign. Among the many insights I gained from that experience one, in particular, stood out far more prominently than any other. Based on frequent and prolonged interaction with the voting public over the course of a pretty intense year, I concluded that the greatest threat to our country comes not from any physical danger posed by terrorists or a competitor state, or even the growing fiscal dangers generated by our extraordinary levels of debt and complete inability to restrain our spending habits, but rather from the growing divide between our citizenry and our government. Specifically, I found that the American voting public is generally apathetic, highly cynical, and quite uninformed...a sad combination of traits that feed on each other with tragic results but that are, I think, a natural result of "extended affluence."

Over its 237-year history, our country has enjoyed such great success that it stands astride the world. The dissolution of the Soviet Union left us with no existential threat. We possess the largest and most productive economy. We enjoy greater abundance, more opportunity, and fewer basic concerns than any other people in any other country. But our success has bred complacency, disinterest in the world around us, a singular lack of curiosity about the ‘why’ of our success and the lack of it elsewhere, and the expectation that our quality of life is a right unto itself with little obligation, if any, for each person to contribute to its maintenance...after all, everything that might be enjoyed in this country is a 'right': healthcare, a good paying job, higher education, broadband internet access. In fact, it seems that legal citizenship isn't even required these days. Go figure! 

Because so many people have ceased to care and have such little interest in making the effort to understand the reasons for our condition, they are readily seduced by politicians who make wholly unrealistic promises to garner their vote; who couch government subsidies as ‘entitlements’ rather than costly programs that divert limited resources from wealth- and opportunity-generating private enterprise; and who promote sundry programs and 'benefits' that inexorably make our ‘free and independent’ people subordinate to and dependent on the good will of the government. 

Worsening the divide are the accumulated abuses of power by fellow citizens who gain public office only to use it for personal gain. Every time a government official--whether elected, appointed, or career civil servant--betrays the trust of the public, they feed the public’s cynicism of all things ‘government, widening the divide between the American people and the government our forefathers intended would serve the public’s interests. Perhaps as a consequence, the percentage of eligible voters who take the time and interest to participate in our elective process declines each year to the point where nearly half don't bother to vote even in a national general election and barely 20% participate during the Primaries. Among those who do cast a vote, an increasing percentage vote for candidates who promise the easy path, who make no demands for self-discipline, who pillory the productive sector—perversely casting wealth-and job-creators as the enemy of those who need jobs that provide the surest path to wealth and greater opportunities, who coopt and distort the ideals of ‘freedom,’ ‘equality,’ and ‘tolerance’ in ways that advance the interests of party and ideology over the long-term interests of our country and that betray the original meaning of these principles as they were understood and applied by our Founders.

But this isn’t something new to our time. Returning to Tocqueville, he recognized the subtle, seductive, but ultimately lethal danger of 'soft despotism':
Thus, After having thus successively taken each member of the community in its powerful grasp and fashioned him at will, the supreme power then extends its arm over the whole community. It covers the surface of society with a network of small complicated rules, minute and uniform, through which the most original minds and the most energetic characters cannot penetrate, to rise above the crowd. The will of man is not shattered, but softened, bent, and guided; men are seldom forced by it to act, but they are constantly restrained from acting. Such a power does not destroy, but it prevents existence; it does not tyrannize, but it compresses, enervates, extinguishes, and stupefies a people, till each nation is reduced to nothing better than a flock of timid and industrious animals, of which the government is the shepherd.
I have always thought that servitude of the regular, quiet, and gentle kind which I have just described might be combined more easily than is commonly believed with some of the outward forms of freedom, and that it might even establish itself under the wing of the sovereignty of the people.
Our contemporaries are constantly excited by two conflicting passions: they want to be led, and they wish to remain free. As they cannot destroy either the one or the other of these contrary propensities, they strive to satisfy them both at once. They devise a sole, tutelary, and all-powerful form of government, but elected by the people. They combine the principle of centralization and that of popular sovereignty; this gives them a respite: they console themselves for being in tutelage by the reflection that they have chosen their own guardians. Every man allows himself to be put in leading-strings, because he sees that it is not a person or a class of persons, but the people at large who hold the end of his chain.
By this system the people shake off their state of dependence just long enough to select their master and then relapse into it again. A great many persons at the present day are quite contented with this sort of compromise between administrative despotism and the sovereignty of the people; and they think they have done enough for the protection of individual freedom when they have surrendered it to the power of the nation at large.
It's not that Tocqueville was prescient. Rather, he was a keen observer of people and recognized their natural tendency to seek the easiest path over time. This is the very situation weakening our country today. Doesn't our government "[extend] its arms over the whole of the community...covering the surface of society with a network of small complicated rules...that seldom [forces men] to act, but...constantly [restrains them] from acting"? Doesn't our citizenry seem content to extend and deepen its dependency on the multitude of programs, subsidies, and protected statuses generated by the government they have selected to act as shepherd? 

It seems that while we were successful in gaining independence from an abusive tyrant, fought a horrific civil war to maintain a Union free of forced servitude, and throughout the 20th Century engaged in numerous battles large and small to promote Freedom and Democracy elsewhere we find ourselves willfully subjugating ourselves to our own government. Entitlements without work. Rights without responsibilities. Authority without accountability. A willingness to complain without first educating oneself as to the 'why' or 'how' of things. Comfort in demanding without contributing. And willful ignorance, if not outright condoning or, worse, desiring, policies harmful to our long-term interests then feigning outrage when the natural and logical consequences come to full flower.

To quote that great philosopher from Okefenokee Swamp, "We have met the enemy and he is us."

Yes, things seem pretty dire. And yet I maintain an optimistic view of our future. Why? Because, returning full circle, I am convinced of the power and enduring quality of the principles upon which our country was founded. Just take a moment to reflect on the outcomes of all other forms of government and on the various attempts by tyrannical regimes to seize and hold power, especially in today's world. People have seen the good that comes from the system we have enjoyed for over two centuries and they want what we have. The stupid try to seize our type of power by force, but they reveal their stupidity by not understanding the 'why' of it. We forget the 'why' from time to time but eventually wake up and 'do the right thing.' Our system reflects that best ideals of Man, accounts for the tendency of men to swing from one extreme to another, for individuals to seek the easy path but for societies to recognize the harm over time and in their collective response to effect corrections...even if such corrections are more painful, bloody, and destructive than they should have been had they been corrected earlier.

Tocqueville observed that “The greatness of America lies not in being more enlightened than any other nation, but rather in her ability to repair her faults.” 

I think Tocqueville is as right here as he is in his other observations. We have it in our power to correct our ways and we are blessed with a system that not only facilitates corrections but by its very organizing principles accounts for the nature of 'free men' to recognize dangers--sooner or later--and act to counter them. 

I love our Country and I know that eventually we will get our act together. I just wish it didn't have to be so hard.