Warning: This post is just as wonky and boring as the title makes it sound.
This essay by Jerry Taylor and Peter VanDoren of the Cato Institute perfectly captures a real confusion I have about libertarians.
They discuss the two versions of the energy bill -- House and Senate -- and say pretty much what you'd expect libertarians to say: Every provision that has government giving money to a market actor, taking money from a market actor, or restricting the behavior of a market actor is bad, bad, bad.
Okay, fine. But what's the motivation?
Here are the two possible versions of libertarianism:
- On the one hand, a libertarian might care foremost about market fairness. The preference would be for no government interference in the market at all -- the ultimate in impartial fairness. However, failing that, the preference would be that tax breaks, subsidies, or regulations applying to one market actor apply to all equally. The idea is that a level market playing field allows investors and consumers to decide on winners and losers without any structural disparities distorting their decisions.
- On the other hand, the libertarian might simply oppose government intervention in the market, of any kind, period. On this view government intervention, government power, is the primary evil and its absence the primary good; market fairness is a possible but not necessary result of reducing gov't power.
So, how would the difference play out? Energy markets offer a great example.
Right now, the oil industry benefits from numerous government-dependent features of the market. It doesn't have to pay for the massive military costs of intervening and maintaining bases in oil-rich countries. It doesn't have to pay for the health care costs arising from its pollution, from the car-happy suburban lifestyle it makes possible, from the processed, fat-and-corn-syrup-heavy foods it makes possible (thanks to petroleum fertilizers). It doesn't have to pay for the infrastructure, land-use, and appropriations decisions gov't makes on its behalf. It doesn't have to pay for global warming. And of course, it receives billions in direct subsidies and tax breaks. It is extraordinarily privileged.
So the libertarian faces a decision. A libertarian who first and foremost despises gov't intervention will wage war on these various direct and indirect subsidies. A libertarian who first and foremost seeks market fairness -- and acknowledges the immense political power of the oil lobby -- might advocate for some subsidies for clean energy, to attempt to level the playing field.
But Taylor and VanDoren do neither. They do not acknowledge the market distortions favoring oil at all. They simply decry any attempt by government to boost renewable energy, reduce oil use through efficiency, or regulate energy companies.
In fact, they even go so far as to say the House version is better than the Senate version, even though the former contains much more pork -- the pork is just directed to oil and gas companies.
One is tempted to conclude that libertarianism has nothing to do with it -- that Taylor and VanDoren are not advocating for a free market but simply shilling for the fossil fuel industry.
And that's what bugs me about libertarianism in general. In theory it has equal hostility to all market distortions, but in practice it reserves its hostility for attempts to rebalance a market already heavily weighted to favor the powerful.
I don't want to come to this conclusion. I'm desperate to find principled arguments in today's political climate, even arguments I disagree with.
Can someone -- in the unlikely event that anyone's read this far -- explain why I'm wrong about Taylor and VanDoren?
Comments
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Jerry Taylor Posted 12:14 pm
20 Jul 2005
First off, Dave, both of your alternative descriptions of libertarianism are rather cartoonish and neither reflects our sentiments. We believe that government has a limited but well-defined role in markets. To wit, to protect private property rights, to protect consumers against fraud, and to ensure the efficient provision of public goods.
In the energy context, protecting property rights primarily means ensuring that the costs of pollution are internalized in energy prices if possible. Ensuring the provision of public goods means governing the disposal of waste in air and water sheds. But once prices reflect total costs (including environmental costs), we hold that decisions about how energy is generated and how much is consumed should be made by consumers, not by politicians or regulators.
Apparently, however, we disagree about the facts. We do not believe that direct government tax breaks, preferences, or R&D programs significantly effect oil prices (an opinion shared, by the way, by the GAO and Energy Information Administration). Nor do we think that our foreign or military policies reduce oil prices below what they would otherwise be. While we concede that environmental damages caused by oil consumption might not be fully internalized in energy prices, that's still unclear given the vast disagreement among public health officials about the consequence of exposures to various pollutants and among scientists about exactly how much economic damage global warming might bring if left unattended.
Moreover, we believe that the best remedy for a subsidy is to get rid of that subsidy, not to lard on more to counterbalance it. Both of us are on record calling for the elimination of all government subsidies and preferences in energy markets no matter which industry is on the receiving end, eliminating the "oil security" mission from the military budget and from U.S. foreign policy considerations, and we are both happy to entertain discussion about how best to internalize externalities via taxes. Second best solutions, however, have proven to be cures worse than the disease.
We have written all of this before in other places (and if you'd like a reading list of said articles, op-eds, and essays, we'd be happy to provide them). Why didn't we say all of this in our piece at NRO yesterday? Because there's only so much one can talk about in an 800 word op-ed and our guns were targeted on other matters.
By the way, we wrote that the House energy bill was less obnoxious than the Senate energy bill because the total amount of energy subsidies provided in the former were less than were provided in the latter.
Finally, the suggestion that we are simply in the business of "schilling for the energy industry" is ridiculous. The energy industry, remember, is in FAVOR of these energy bills. We are not. In addition, we have argued AGAINST reauthorization of the Price-Anderson Act (which relieves the nuclear power industry of liability for major accidents), AGAINST forcing LNG terminals in communities that don't want them (an argument you seem to have missed in our op-ed), AGAINST federal assumption of responsibility for nuclear waste disposal (let the industry pay for it themselves and get insurance to protect against liability from the same), AGAINST the clean coal technology program, IN FAVOR of giving ANWR to a consortium of conservation groups to do with as they please, AGAINST producer tax credits for small domestic oil producers, AGAINST those who want to blame tight refinery margins on environmentalists, AGAINST those who want to prohibit state adoption of clean gasoline standards, AGAINST those who want to blame environmentalists and energy efficiency advocates for a shortage of electricity in California during the energy crisis, and IN FAVOR of treating old sources of pollution in the Clean Air Act in the same regulatory manner that we treat new sources of pollution.
I could go on and on, but you get the point. All of the arguments above could have been found with our name on them through a simple Google search. You might even have found a couple of joint op-eds written by me and environmentalists from the Sierra Club and Friends of the Earth making some of the argument above. I doubt many would characterize my opinions about energy policy as those that would make most energy companies particularly happy.
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amazingdrx Posted 11:08 pm
20 Jul 2005
Why is that dave?
Because as I said to the kids at the Cato debate forum, libertarians have been coopted by neo-conservatives.
In the neo-conservative sphere the end justifies any and all means. They take over a libertarian think tank and then use it for their own purposes.
Real libertarians would see that in order to maintain free markets and competitive capitalism, the basis of the pursuit of financial happiness guaranteed the individual in our constitution, government must restrain the power of monoply forces on those free markets.
Just as Teddy Roosevelt did to Standard Oil. TR a libertarian? Yep.
But these Cato guys? Nope.
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accel2 Posted 11:54 pm
20 Jul 2005
I appreciate Jerry Taylor's candid, fair, if somewhat passionate, response.
And I must say I agree with Dave Roberts in that I value honesty, reason, and the willingness to self-critique much more than I value any specific pre-packaged idealogy.
-Mike
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Jerry Taylor Posted 12:10 am
21 Jul 2005
Having a serious conversation about public policy requires two things. First, being civil and not reflexively going into ad hominem mode. In Dave's original blog post, he says "OK, I read Taylor & VanDoren's op-ed, now what's their motive?" Come on - let's be civil and assume our motives are as pure as yours. Besides being polite, it's a logical fallacy to assume that one's motives have anything to do with the merit of what is being said.
Second, one must know something about what one speaks - or at least, be willing to learn something about what one speaks. "Energy industry schill" this and "neocon" that demonstrates that one does not not of what one speaks. We may be wrong, be we are neither of the above - as even 10 minutes on the web would reveal to anyone interested.
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amazingdrx Posted 12:10 am
21 Jul 2005
Here's a really big talking point neo-conservative dodge. That same old schtick, it's on us environmentalists to prove harm from pollution and global climate disaster from CO2 emmissions is real, it's just a "theory".
Just a theory, so is the "theory" of gravity, jump off a cliff and prove it wrong Cato-ins.
Just like the "theory" that smoking tabbacco causes cancer. Smoke 'em if you got 'em neoconmen. Help save social security by dying early! Hehey.
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Jerry Taylor Posted 12:20 am
21 Jul 2005
We do not believe that "it's on [you] environmentalists to prove harm from pollution and global climate disaster from CO2 emmissions is real ...." If you go to the "Cato Handbook for Congress" (available electronically on our website) and look at the chapter I wroter therein on environmental policy, you'll see that I argue that environmentalists shouldn't have to prove existing standards cause significant environmental harm - or that tightened environmental standards would produce human health benefits - to justify tougher environmental regulation. Simple preferences for cleaner air and water (or whatever) are sufficient justifications for regulating the environmental commons.
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amazingdrx Posted 12:31 am
21 Jul 2005
But that talking point argument that you use, that global warming or climate change (I call it global climate disaster)is unproven, is pure neocon corporatist propaganda.
Dave did slip the rules of informal fallacy by questioning motives, as do I from time to time. We can still address your arguments one by one and point out the similarity with neo-conservative talking points. I still think it's useful politically, if not a reasonable basis for argumentation.
Maybe you do not see yourselves as aligning with corporatists in the energy policy area and you actually believe that real libertarian poltical philosophy would overlook the effect of monopoly forces on free markets and the individual incentives for invention and creativity that exist under true competitive capitalism?
In that case I suggest you go back to the drawing board. Wake up and smell the freedom lost, the freedom libertarians cherish, when corporate monopoly power acts from within government. It is destroying our constitution and our democracy.
I'm sorry Jerry, but government must act to regulate monoply forces over free markets as Teddy Roosevelt did. The world you envision where costs are incorporated in prices and then the markets are set free to run on their own simply doesn't work, it devolves into corporate feudalsim.
I think true libertatianism coincides with that point of view. Should Walmart really be allowed to enter a community and sell products below the price of production for years to put every other store in the area out of business then rule as a monopoly enterprize?
That is what your model will produce, and is producing across the US and now around the world. Government of, by, and for we the people sometimes needs to act and regulate to restrain monopoly corporate power.
These neo-conservatives have instituted governance of, by, and for corporate power. Thank you for opposing them, at least in the foreign policy arena, now please get to work opposing them on other fronts, like domestic energy policy!! We need your help!!!
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amazingdrx Posted 12:39 am
21 Jul 2005
As far as hijacking the discussion? No way, your input will fire it up. That's exactly what is needed.
Thanks for replying to my comments. Any jibes unfairly comparing you to the despised neocons was made in the heat of battle, sorry for that.
But these armchair warrior, chickenhawk, war on the cheap, WMD liars do get the blood of any patriot ready to do battle.
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Jerry Taylor Posted 1:20 am
21 Jul 2005
My opinions about Walmart or whatnot are immaterial to the my take on the energy bill, so I won't address them here.
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amazingdrx Posted 9:46 pm
21 Jul 2005
http://amazngdrx.myblogsite.com/blog/_archives/2005/6/26/974892.html
Subject to dispute eyyh? Go ahead and "dispute" the "theory" of gravity then. Maybe you'll float rather than land in a heap after jumping over a cliff?
That is what your analysis is advising the residents of spaceship earth to do. And you are only interested in calculating costs?
You can't take it with you, jumping off the global climate disaster cliff may cost more and more victims of storms, droughts, fires and other natural disasters EVERYTHING!!
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Grimreader Posted 9:14 am
23 Jul 2005
Also, please tell us the exact costs of climate change, since they are as clear as gravity.
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amazingdrx Posted 5:35 am
14 Sep 2005
http://mediacitizen.blogspot.com/2005/05/sock-puppet-revue.html
Raises a few questions about think tank independence of thought?
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