Romney won’t be president, and other good news

It’s no secret that I greatly dislike both Obama and Romney, so my expectations were pretty low going into yesterday’s election. Thus it came as some surprise to me that I went to bed late last night feeling happier about the results than I have for any election in my lifetime, and that has nothing to do with who will or won’t be in the White House.

Yesterday morning I tweeted, “Hoped-for silver linings today: Marijuana legalization, marriage equality, no GMO labeling, good turnout for Gary Johnson.” Pretty much everything I could have reasonably hoped for came true.

Marijuana legalization — Two out of three states where marijuana legalization was on the ballot approved the measure. My own Oregon let me down, but Washington and Colorado succeeded. Voters also legalized medical marijuana in Massachusetts and decriminalized it in Detroit. By putting two states in direct conflict with the federal government, this is potentially a watershed year in the movement toward a more humane drug policy.

Marriage equality — Same-sex marriage was on the ballot in four states yesterday. In Maine, Maryland, and Washington, it was approved by popular majorities. In Minnesota, a majority rejected a constitutional ban on gay marriage. Demographic shifts and growing social acceptance make it seem inevitable that more, perhaps all, states will eventually follow their lead.

GMO labeling — This is one issue on which I’m opposed to many of my peers in the food and drink industry, but I think that California’s proposal to require labeling of genetically modified foods was deeply flawed. The case that they are harmful to consume is very weak, labeling and liability would be costly, and the proposal itself was riddled with exemptions. If consumers and activists want to avoid GMOs I would rather see them push for more organic food or other explicitly GMO-free options than force mandatory labeling onto the entire food system. Cheers to California voters for getting this one right.

Eminent domain bonus — I wasn’t following Virginia’s referendum to further protect private property from Kelo-style takings for private development, but I’m heartened to learn that it was overwhelmingly approved.

Gary Johnson — His campaign never crystallized as I hoped it might, but Johnson nonetheless earned 1% of the vote and as of this writing a raw total of 1,139,562 votes, the most of any Libertarian Party candidate in history. More importantly, I think Johnson may have done more than any recent candidate to reach out to the left and make libertarianism cool. (Sorry, Bob Barr.)

Romney lost — Romney was just terrible. The flip-side is that Obama won, which is also terrible but marginally less so. Most importantly, yesterday was a straight-up beatdown for social conservatism and the last twelve years of Republican politics. This opens the door, at least, to a better GOP.

After all of this, watching Obama’s soaring acceptance speech at a bar in downtown Portland was simply anti-climactic. As my friend Conor Friedersdorf tweeted, “This speech would be more enjoyable if I didn’t already know what follows Barack Obama speeches like this. An imperial presidency.” Or as my friend sitting next to me summed it up, “I don’t even care about this shit. This is just bullshit.”

The electoral outcome of this presidential race was going to be dismal no matter what. On the economy, on foreign policy, on the Drug War, neither side offered the kind of changes we need. The inspiring story from yesterday is that in so many instances where voters had the option to expand freedom directly, they voted to do so. Given the opportunity to let gays marry the people they love, to let sick people access medical marijuana, to let ordinary citizens smoke a joint once in a while without fearing prison, they voted to live and let live. This bodes well for the future. We progress in spite of our politicians.

A case for Gary Johnson

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“Be Libertarian with me for one election,” suggests Libertarian presidential candidate Gary Johnson in a recent advertisement. I’ve voted Libertarian in every election in which I’ve been eligible, so it’s no surprise that I’m doing so again this year. But my previous votes weren’t always enthusiastic. The party’s track record nominating candidates is decidedly mixed and I’ve gone along with some of their selections not out of any real support for the candidates, but only to sustain the party until they nominated someone stronger.

This year they did. Johnson, a successful two-term former governor of New Mexico, is the most credible candidate the Libertarian Party has ever offered. And given the dismal competition from the two major parties, his timing couldn’t be better.

I never had high hopes for Obama on economic matters but on a few areas, such as civil liberties, there was some expectation that he would be better than his predecessor (though even then there were warnings to the contrary). Instead, he’s expanded some of the worst practices of the Bush Administration. To give only a brief summary:

Extrajudicial assassination via drone, even of American citizens, is now a routine part of the presidency.

Indefinite detention without trial has been signed into law and federal attorneys continue to defend the power in court.

Despite initial promise on medical marijuana, the administration has ramped up the pace of armed raids on clinics operating legally under their states’ laws.

The administration has declined to bring any charges in cases of torture perpetrated by the CIA.

It goes with saying that Mitt Romney would be even worse on these issues. It’s difficult to know his true position on anything, but one thing is certain: He is no skeptic of state power. He’s hawkish on foreign policy, has no qualms using force to regulate personal behavior, and in the 2008 debates had this to say about indefinite detention without trial:

“I’m glad they’re at Guantanamo. I don’t want them on our soil. I want them in Guantanamo where they don’t get the access to lawyers they get when they’re on our soil. I don’t want them in our prisons. I want them there. Some people have said we ought to close Guantanamo. My view is, we ought to double Guantanamo.”

There’s not much to say in Romney’s favor on economics, either. His supposedly Ayn Rand-inspired running mate, intended to shore up his credentials, voted for TARP, auto bailouts, and Medicare Part D. Romney and Ryan likely offer to defenders of free markets what Obama offered to defenders of civil liberties: pleasing words followed by multiple stabs in the back.

Even by the usual low standards of presidential elections, the choices offered by the major parties this year are bleak. But unlike in past elections, the Libertarian Party has offered an alternative with legitimate credentials and appeal. A guy whom I think I could persuade some of my less explicitly libertarian friends to get behind. A guy whom I would actually be happy to see as president, if by some miracle he were to win.

Johnson, who governed as a Republican in a state dominated by Democrats, has cross-party appeal that could siphon votes from both candidates. He’s an outspoken advocate for marriage equality, supports legalization of marijuana, calls for ending the War on Drugs and treating addiction as a medical issue, and recognizes an important role for government in protecting the natural environment from polluters.

On the American Civil Liberties Union’s candidate report card [PDF], Johnson scored higher than Obama and any of the Republicans. He endorses repeal of the Patriot Act, an end to indefinite detention without trial, and a non-interventionist foreign policy.

Johnson is a more credible opponent of economic cronyism than Romney and Ryan, criticizing the complexity of the current tax code and the incentives it creates for lobbying on behalf of special interests. He endorses free trade and expanded opportunities for legal immigration. He concluded his terms as governor with a budget surplus and vetoed more than 700 bills. Like Josh Barro, I think the drastic cuts he calls for are unnecessarily severe in the short-term and do him no favors appealing to a broader base. I’m also unpersuaded as of yet by his tax policy. However such changes would have to come from Congress, not the executive branch, which would enforce the moderation with which he actually governed.

Johnson winning the presidential race is obviously a long shot, but he needn’t win for his campaign to be worthwhile. Simply being allowed to participate in the presidential debates would dramatically alter their tone, which will otherwise be a race to the bottom on civil liberties, spending, and military intervention. The debate commission – closely tied to the major parties – excludes third party candidates polling under 15%, so for that reason alone it is worth supporting his campaign and raising awareness of it.

Polling suggests that with more awareness of his candidacy, Johnson could find more support. Voters have been fleeing affiliation with the major parties for decades. Poll analyses by the Cato Institute find that about 14% of voters fit a fairly strict definition of “libertarian.” Under a broader definition as “fiscally conservative and socially liberal,” more than 40% accept the label.

Nonetheless, convincing people to actually vote for a third party candidate is an uphill battle. There are two reasons I encourage them to do so, one practical and one principled.

First the practical reason: It’s extremely unlikely that either Romney or Obama will miss your vote. Even if this turns out to be a close race at the national level, the race for electoral votes in your state may not be. Oregon, where I now live, appears to be of little consequence in the national election. The conclusion from FiveThirtyEight:

[...] in over 99 percent of the model’s simulations, Oregon’s seven electoral votes prove either a given for a winning Mr. Obama or unneeded for a victorious Mr. Romney.

The pessimistic view of this is that Oregonians’ votes don’t matter. The optimistic view is that we are free to vote our conscience. Are you tired of voting for war, civil liberties abuses, and cronyism? Congratulations! You needn’t feel obliged to cast your lot with the lesser evil.

And that brings me to the principled reason to vote for Johnson. Politics necessitates compromise; rarely does one find a candidate that one agrees with on every issue. But there are some issues on which one should not compromise. Among these, I suggest, are imprisoning people without trial and overseeing a secret “kill list” of assassination targets.

This string of civil liberties abuses began under Bush but one thing you could say in Bush’s favor is that at least he inspired a vocal opposition. Obama has largely bought them off, cementing excessive executive powers and leaving them intact for the next Republican president, whomever he may be. Concerns about civil liberties that seemed vital under Bush have been erased from the Democratic platform now that the party is in power.

There’s a very good discussion of this recently between law professor Jonathan Turley and actor John Cusack. (John Cusack, who knew?) It’s long but I highly recommend it. Here’s one exchange:

CUSACK: Yeah, yeah. And so then it gets down to the question, “Well, are you going to vote for Obama?” And I say, “Well, I don’t really know. I couldn’t really vote for Hillary Clinton because of her Iraq War vote.” Because I felt like that was a line, a Rubicon line –

TURLEY: Right.

CUSACK: — a Rubicon line that I couldn’t cross, right? I don’t know how to bring myself to vote for a constitutional law professor, or even a constitutional realist, who throws away due process and claims the authority that the executive branch can assassinate American citizens. I just don’t know if I can bring myself to do it.

If you want to make a protest vote against Romney, go ahead, but I would think we’d be better putting our energies into local and state politics — occupy Wall Street and organizations and movements outside the system, not national politics, not personalities. Not stadium rock politics. Not brands. That’s the only thing I can think of. What would you say?

TURLEY: Well, the question, I think, that people have got to ask themselves when they get into that booth is not what Obama has become, but what have we become? That is, what’s left of our values if we vote for a person that we believe has shielded war crimes or violated due process or implemented authoritarian powers. It’s not enough to say, “Yeah, he did all those things, but I really like what he did with the National Park System.”

CUSACK: Yeah, or that he did a good job with the auto bailout.

TURLEY: Right. I think that people have to accept that they own this decision, that they can walk away. I realize that this is a tough decision for people but maybe, if enough people walked away, we could finally galvanize people into action to make serious changes. We have to recognize that our political system is fundamentally broken, it’s unresponsive. Only 11 percent of the public supports Congress, and yet nothing is changing — and so the question becomes, how do you jumpstart that system? How do you create an alternative? What we have learned from past elections is that you don’t create an alternative by yielding to this false dichotomy that only reinforces their monopoly on power.

The big question of this election is not who whether Romney or Obama is marginally better than the other. The question is how to fight the abuses of power that have been fully embraced by both of them. Voting for Johnson is one small way to do so. Imagine if 5 million or 10 million people voted for a candidate running on a platform of civil liberties, ending the Drug War, non-interventionist foreign policy, and an end to cronyism. You don’t have to be a libertarian – you don’t even have to want Johnson to win — to think that this would have a beneficial long-term effect on policy as the major parties try to win those votes.

That will never happen if voters allow themselves to be held hostage by Romney and Obama. And, for once, a third party has offered a worthy alternative. This year the surest way for the constituency supporting civil liberties, economic freedom, and social toleration to express itself is with a good turnout for Gary Johnson.

Recent reading

The Family Meal: Home Cooking with Ferran Adria, Ferran Adria — As I’ve gotten more into cooking over the past year, my biggest obstacle to doing more of it is taking on recipes that are too complicated, too time-consuming, or require too many esoteric ingredients. As a result I enjoy cooking when I get around to it, but all too often I end up getting food out and putting off trying new things.

Ferran Adria of elBulli, the legendary restaurant famed for its innovative culinary techniques, is not the person I thought would reverse this. But his book of home cooking, which collects recipes from the “family meals” elBulli served their staff each night, does exactly that. The dishes by necessity tend to use readily available ingredients that are mostly inexpensive; each dish is given in quantities for two, six, twenty, or seventy-five diners. The methods are fairly simple and make the most out of light lists of ingredients. I brought it with me to Upper Peninsula Michigan and was able to cook from it there; if you can source items in the U.P. you can source them anywhere. I still have a lot more to try from this book, but so far everything has been good. More importantly, it’s a book that I’m actually using with frequency.

A Capitalism for the People: Recapturing the Lost Genius of American Prosperity, Luigi Zingales — Recommended by everyone from Tyler Cowen to Brad Delong to Paul Ryan, this is an impressive book. It’s libertarian without being ideological, diagnosing the cronyism that plagues our economics system and offering institutional solutions to fix it. Capitalism has taken a bruising in the past decade, not least of all from its supposed defenders. Zingales’ “promarket populism” hits exactly the right tone; I’d unhesitatingly recommend this to friends on the left and the right.

Ron Paul’s eEVOLution: The Man and the Movement He Inspired, Brian Doherty — I hadn’t planned on buying this book but picked it up when Brian Doherty visited Powell’s in Portland. Having read Brian’s previous book and followed Reason magazine’s daily coverage, would I really enjoy an entire book about Ron Paul? The answer is yes, and I finished the book appreciating Paul’s career more than I had before.

A brewery in the White House

We are deep into that part of the election when it’s impossible to escape the flood of frivolous news articles about what the candidates ate, exaggerated gaffes, or pretty much anything except actual policy. This week’s example: the fervor about the homebrewed beer that Obama occasionally breaks out on the campaign trail. Crowds chant “four more beers,” reporters get to write punny headlines like “Obama plays up love of beer to ferment coalition of the swilling,” and beer lovers in my Twitter feed gush that the president makes and drinks beer just like them, so, like, who cares about all his Bush-esque civil liberties abuses?

I reacted to the story with my usual political cynicism, but on further reflection having a sitting president publicly boast of his homemade beer represents a real advance in freedom. Though it’s hard to believe as I sit here typing in Portland, Oregon, where making a batch of homebrew with friends is a wholesome afternoon activity, brewing beer at home continued to be against the law in the United States long after Prohibition.

Portland-based homebrew advocate and local legend Fred Eckhardt wrote in his seminal A Treatise on Lager Beers about the state of American beer in 1969:

After Prohibition, it remained illegal to make homebrew (it still is) and so even then there was no light to be shed on the subject. Now more than 35 years after the end of Prohibition we are just beginning to explore the possibilities of homebrewing… There are almost no quality beers made in this country, so if you want good old-country style beer you must make it yourself. Even the German beers imported into this country are being made to the so-called American taste. Pablum and pap for babies. You actually can make beer just as good as the great European master brews in your home. This book is only a start.

Indeed it was. Nine years later, President Jimmy Carter signed legislation allowing people to brew reasonable quantities of beer at home for their personal use, no permits or taxes required. Today American brewers make some of the best beer in the world and many of them got their start making small batches in their garages and kitchens. (The quote above is excerpted in Nick Gillespie and Matt Welch’s The Declaration of Independents, which should be on everyone’s election year reading list.)

Prohibition casts a long shadow, however, and there are still many regulations that can trip up homebrewers. Homebrewing is completely illegal in Alabama and Mississippi. In other states archaic laws have banned removing homebrew from the home, shutting down beer competitions. In Oregon, such a law was amended last year after public outcry. Perhaps seeing the nation’s top elected official drinking beer made at his home will give added legitimacy to the practice and help remove these remaining barriers.

For what it’s worth, I’m not sure that even Obama’s beer is completely legal. [Update: See below for a response from the TTB.] As Dan Todd pointed out to me on Twitter, the beer is made by White House chefs, not the president himself. According to Reuters:

The beer, which comes in both a light and dark variety, is made by the White House chefs who use traditional beer-brewing methods. [...] Taxpayers are not footing the bill for the beer, as both the cost of the equipment and the cost of brewing the beer is paid for by the Obamas personally, the official said.

Federal law states that homebrewed beer cannot be sold and that it cannot be produced by partnerships or corporations:

Any adult may produce beer, without payment of tax, for personal or family use and not for sale. [...]

Partnerships except as provided in §25.207, corporations or associations may not produce beer, without payment of tax, for personal or family use. [The exception referred to is for operators of licensed breweries, who may take some of their product home without paying taxes on it.]

The Tax and Trade Bureau also has strict regulations for brew-on-premises facilities (BOPs), businesses that provide equipment and space to homebrewers, and the assistance they are allowed to provide to clients:

Proprietors and employees of BOPs may not:
Provide assistance to, or on behalf of, customers in the production, storage, or packaging of beer, such as:
– Fermenting mash,
– Adding sugar, CO2, or any other ingredients to beer,
– Filtering or bottling beer, or
– Providing physical assistance in the production, tank transfer, racking, or the bottling or kegging of beer.

I don’t know the specific arrangement the White House beer is brewed under, but having employees brew beer for one’s personal use seems possibly problematic. The president may also be stretching the meaning of “personal use.” When Obama gives his beer away to potential voters while running for office, does that still qualify? It would take one hell of a gutsy TTB agent to levy fines against his ultimate boss, but it sure would be amusing to watch the attempt.

Having a brewery in the White House also provides an opportunity to raise the question of why home distilling, which essentially requires only the additional steps of boiling one’s beer and collecting portions of the condensate, remains an illegal offense that can land one in prison. Merely owning a still in this country is suspect: It must be low in volume, can only be used for making purified water, essential oils, fuel, etc., and the TTB can demand from sellers of stills the name and address of any customer, no warrant required.

Our first president, George Washington, had a distillery on his property and underground distillers continue the tradition of making quality spirits at home. Unfortunately, making craft spirits legally requires leaping some major hurdles. Darek Bell, owner of Corsair Distillery in Nashville, Tennessee, discusses this in his extremely interesting book on distilling, Alt Whiskeys:

Unfortunately, only a few countries in the world allow legal home distilling. New Zealand, for example, is one of them. In the United States, distilling whiskey without a federal permit is a felony. This is no parking ticket. It is life destroying: five years in jail and a $10,000 fine.

Bell compares craft distilling today to craft beer in the 1980s. Small distillers are making excellent products but they’ve not yet achieved their full creative potential, hampered as they are by high start-up costs and regulatory requirements. Bell’s beer-inspired recipes provide a glimpse of what the future of small-scale whiskey might look like: Chamomile Wheat Whiskey, Huckleberry Moonshine, Bavarian Helles Whiskey. But trying these at home or experimenting with them before going commercial is forbidden, so the path that led to full-time careers for many homebrewers is closed to would-be spirits makers. Legal changes to bring home distilling into the open would help unleash this creativity.

This week’s many articles about Obama’s taste for craft beer have been inane, but they do show how far we’ve come destigmatizing and legalizing alcohol. If thirty years from now we have a president stirring Manhattans made with his special White House Whiskey, that will be an even greater sign of progress.

Update 8/23/12: I’ve been trying to reach the TTB for clarification on the legality of having paid employees brew beer for one’s personal use. I haven’t received a response, but I will update if and when I do.

Update 8/27/12: The Tax and Trade Bureau has responded to my request for clarification about the legality of hiring employees to make tax-free beer for one’s personal consumption. Short answer: This is an issue for which the TTB has never issued a ruling, but the law doesn’t preclude it.

Here’s the question I sent to Tom Hogue, who handles congressional and media inquiries for the TTB:

I’m curious if the TTB has ruled on the legality of having paid employees brew beer for one’s personal consumption. Without necessarily commenting on the White House beer specifically, would this qualify as legal homebrewing? If so, can ordinary citizens hire personal chefs to brew beer for them without paying taxes on it?

And here’s Tom’s response:

The answer to your question is generally speaking, yes. We have not issued a ruling on this issue, however, the regulations do not preclude a person from hiring a personal chef to brew beer for them, provided that they adhere to the regulatory provisions relating to personal or family use.

This is interesting for a couple reasons. First is that the White House brewery has brought up an issue that the TTB has never had to rule on before. Second is that while it’s illegal to sell homebrewed beer, one can apparently sell the labor that goes into making it. This opens up potential business opportunities. For personal chefs it’s an additional service they can offer and one more way they can differentiate themselves from the competition. It might even be possible to work as a “professional homebrewer,” traveling from house to house making beer to clients’ specifications. Who knows if there’s enough demand for that, but it’s an intriguing possibility. (There is at least one “Homebrew Guru” offering something like this in the form of home instruction.)

A caveat to the above: With no official ruling on the subject, these ideas are purely speculative. If more people start earning money making homebrew, the TTB may decide to rule and the selling beer vs. selling labor distinction might not hold up. But for now, at least, an enterprising brewer can claim a sitting president and former University of Chicago law professor as an example in his favor.

Koch vs. Cato

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The other thing that happened while I was on the road this week was not so fun: The Koch brothers filed a lawsuit against the Cato Institute seeking control of the think tank. I was, in fact, visiting Cato the day the news broke. Though Charles Koch was an early funder of the institute, in recent years the Kochs have focused their energies elsewhere while Cato, led by Ed Crane and others, blossomed into a respected, non-partisan think tank.

David Weigel speculates on the likely changes this will mean for Cato if the Kochs’ takeover prevails:

And so, with libertarianism at its modern apex, the Kochs are trying to wrestle the movement’s leading think tank away from the guy who built it up. (Literally. They just completed a renovation.) How would it change? In the past, Charles Koch and his allies have criticized Cato for lacking real, provable results. Since then, David [Koch] has found tremendous success with Americans for Prosperity, which in the Tea Party era evolved into one of the most powerful conservative organizations in electoral politics. (It has spent seven figures so far this year on TV ads against Barack Obama.) Draw your conclusions.

Crane and board chairman Bob Levy corroborate that interpretation.

I was going to write a post about this but Jonathan Adler has beaten me to it. I agree with every word:

Whatever the merits of the Kochs’ claim, I cannot understand how their actions can, in any way, advance the cause of individual liberty to which they’ve devoted substantial sums and personal efforts over the years. Even assuming their legal claim has merit, a legal victory will permanently injure the Cato Institute’s reputation.

Many libertarian-leaning organizations receive money from the Kochs and their foundations and are attacked on this basis. Such attacks can be deflected, as financial support is not the same thing as control. But if the Koch brothers themselves represent the controlling majority of an organization’s board, that organization is, by definition, a Koch-run enterprise. Progressive activists and journalists will have a field day with this. They will forevermore characterize the Cato Institute as “Koch-controlled” — and, as a legal matter, they will be correct. No efforts to re-establish the Institute’s credibility or independence will overcome this fact.

[...] Even if one assumes that the Kochs have better ideas for how Cato should direct its resources, know more about how to advance individual liberty, and are correct that the Institute is too “ subject to the personal preferences of individual officers or directors,” any benefit from whatever changes they could make will be outweighed to the permanent damage to Cato’s reputation caused by turning it into a de facto Koch subsidiary. In short, they will have destroyed the Cato Institute to save it.

In the past I’ve defended the Koch brothers from charges that their political activities are motivated by narrow self-interest. Funding scholarships for libertarian college students or sending them to week-long academic seminars are hardly profit-maximizing uses of their money. Though they are famously secretive, the only sensible interpretation of their actions over the past few decades is that they sincerely believe in broadly libertarian ideas and want to see them succeed in the long-run. Their investment in think tanks, journalism, and other non-profits are groping attempts to discover how best to bring that about.

However this takeover attempt seems in no way compatible with the greater good of libertarian ideas. Whatever the legal merits of the Kochs’ claim, the best outcome for the cause of individual liberty is that Cato continues to operate as an independent, non-partisan, respected think tank with a diversity of funders. There is currently no other libertarian organization fulfilling that role in such a high-profile way. In acquiring the asset the Kochs would inevitably decrease its value. This view is, from what I can tell, widely shared among libertarians who have posted about the matter. Perhaps there is something we don’t know, but given how many people involved in institutional libertarianism have benefited at least indirectly from the Kochs’ donations, that dissent should be telling.

I’m left wondering about the internal institutions surrounding the Koch brothers. They are known for their advocacy of Market-Based Management, but do they receive enough criticism within their non-profit work from the bottom-up? Having become accustomed to holding the purse strings, are they open to negative feedback? Do they have advisers who have the security to be able to tell them to back off? If personal animosity is blinding them to the greater good of the causes they’ve spent decades supporting, is there anyone to tell them that?

I don’t know. But the Charles Koch Foundation can be contacted and if you care about the independence of the Cato Institute I’d encourage you to send them a note:

Charles Koch Institute
Email: email@charleskochinstitute.org
1515 N. Courthouse Rd.
Suite 200
Arlington, VA 22201
Phone: 703-875-1600
Fax: 703-875-1601

There is also a Save the Cato Institute Facebook group, from which the image above is borrowed.

Disclosures: I interned for the Cato Institute in 2003 and later worked in their press office for about a year. I’ve also benefited in various ways from various Koch-funded entities, particularly the Institute for Humane Studies. I no longer benefit in any direct way from either and have great respect and affection for both.

My favorite copy of The Road to Serfdom

I found this at a used book store in Nashville when I was in college there. It’s the eighth American printing, from July 1945.

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In his biography of Friedrich Hayek, Alan Ebenstein writes that paper rationing in World War II made it impossible for UK publishers to keep up with reader demand for The Road to Serfdom:

The initial print run of 2,000 copies sold out within days. According to British intellectual historian Richard Cockett, Hayek’s publisher, Routledge, ordered an immediate reprint of 1,000 copies, and in the “following two years they were to be engaged in a losing race to satisfy the huge public demand for the book.” Because of wartime paper rationing, Routledge could not print as many copies as it wished. The summer following the work’s release, Hayek complainingly referred to it as “that unobtainable book.”

I don’t know if it was ever quite so rare here in the US, but wartime scarcity affected American publishers too. The book is very small, practically a pocket edition. The dedication page explains in tiny print:

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“This printing has been redesigned to conform to the government’s request to conserve paper.” On the classic book against central economic planning. Gotta love it.

A qualified defense of Ayn Rand on Medicare

Michael Ford at Huffington Post calls out Ayn Rand for accepting Medicare payments when she was ill with cancer:

An interview with Evva Pryror, a social worker and consultant to Miss Rand’s law firm of Ernst, Cane, Gitlin and Winick verified that on Miss Rand’s behalf she secured Rand’s Social Security and Medicare payments which Ayn received under the name of Ann O’Connor (husband Frank O’Connor).

As Pryor said, “Doctors cost a lot more money than books earn and she could be totally wiped out” without the aid of these two government programs. Ayn took the bail out even though Ayn “despised government interference and felt that people should and could live independently… She didn’t feel that an individual should take help.”

But alas she did and said it was wrong for everyone else to do so.

This isn’t accurate. While there’s some surface irony in Rand accepting Medicaid payments, in her non-fiction writing she stated clearly that she thought it appropriate for people who share her beliefs to do so:

A different principle and different considerations are involved in the case of public (i.e., governmental) scholarships. The right to accept them rests on the right of the victims to the property (or some part of it) which was taken from them by force.

The recipient of a public scholarship is morally justified only so long as he regards it as restitution and opposes all forms of welfare statism. Those who advocate public scholarships, have no right to them; those who oppose them, have. If this sounds like a paradox, the fault lies in the moral contradictions of welfare statism, not in its victims.

Since there is no such thing as the right of some men to vote away the rights of others, and no such thing as the right of the government to seize the property of some men for the unearned benefit of others—the advocates and supporters of the welfare state are morally guilty of robbing their opponents, and the fact that the robbery is legalized makes it morally worse, not better. The victims do not have to add self-inflicted martyrdom to the injury done to them by others; they do not have to let the looters profit doubly, by letting them distribute the money exclusively to the parasites who clamored for it. Whenever the welfare-state laws offer them some small restitution, the victims should take it…

The same moral principles and considerations apply to the issue of accepting social security, unemployment insurance or other payments of that kind. It is obvious, in such cases, that a man receives his own money which was taken from him by force, directly and specifically, without his consent, against his own choice. Those who advocated such laws are morally guilty, since they assumed the “right” to force employers and unwilling co-workers. But the victims, who opposed such laws, have a clear right to any refund of their own money—and they would not advance the cause of freedom if they left their money, unclaimed, for the benefit of the welfare-state administration.

True, The Fountainhead wouldn’t have been quite as compelling if Roark were depicted collecting unemployment and living on food stamps. But given all the future taxes he surely ended up paying on his skyscrapers, he would have been totally within his rights to do so. That’s Rand’s argument, anyway, and whether or not it’s convincing her actions were in accordance with her stated beliefs.

This is a question that at some time or another confronts everyone of libertarian stripe. Whatever we think the ideal way is of funding various goods, we live in a world where we are taxed to pay for them and where private alternatives are crowded out by government services. For most of us, the question is not “Will I ever use services funded by taxes?”; it’s “Given the extent to which I am taxed to pay for services I may need, under which circumstances can I justify accepting them?” The answers to which we arrive have as much to do with our practical situations and personal integrity as they do with strict principle. To criticize a dying person who paid taxes all her life for accepting aid in her final days, and who had defended taking such aid years earlier, is uncharitable to say the least.

[Via BoingBoing.]

Biasing students in econ 101

Does economics education bias one toward a free market perspective? Patrick Emerson thinks it might:

I think a little economics education leaves you with the impression that the answer to all public policy questions is free markets. This is because in intro classes, we often only have enough time to study and understand markets and their wonderful aspects and about the distortions that taxes and price controls create, often leaving very little time to talk about market failures. This can be true of intermediate classes as well. Later in economics classes, market failures come up all the time and you start to get an appreciation of the limits of markets. But those that only take one or two economics classes will be inclined to believe that market failures are really not that big a deal, after all they were just a quick end note in the class… But I also believe that students self-select into economics classes and that those with free market, anti-tax attitudes will find a lot to like in economics classes. In general I think that professors have very little influence on the core beliefs of students and that mostly student gravitate to professors that teach things that resonate with those core beliefs.

For the most part I agree; if studying economics doesn’t make one appreciate markets, then one probably hasn’t been paying attention. But there are some biases pointing the other way as well.

Perfect competition — Introductory economics begins with the concept of perfect competition, an unrealistic model that nonetheless helps us think clearly about how markets work. Sometimes this is misunderstood to mean that all of economics rests on an weak foundation. A post at Blue Oregon is typical:

Free market economists use models that assume that people are given complete information and make rational decisions. How absurd. No one has complete information, most people have terribly unreliable information, and people make stupid decisions all the time.

Well, I guess we can just ignore economists then!

Market failures — The models taught in econ 101 make it easy to find market failure everywhere in the forms of monopolies, unprovided public goods, and positive and negative externalities. Some of the more compelling defenses of free markets stress that markets are needed precisely because our information is imperfect, but I don’t think that perspective gets much emphasis in introductory economics courses.

Government solutions — When these failures do crop up government intervention is assumed to be the answer. Break up or regulate monopolies, provide public goods, subsidize or tax the activities that create externalities, and voila! Problems solved. Government is rarely treated as being run by self-interested individuals with limited information and therefore susceptible to the same sorts of errors as the private sector. There are lots of government solutions, rarely government failures. How many intro courses even mention public choice theory?

I think Patrick’s right in saying that “professors have very little influence on the core beliefs of students.” If one is inclined toward free markets there is plenty in econ 101 to support those views. If one is inclined toward government intervention econ 101 also makes it easy to find roles for it. A richer education would place more emphasis on putting the simplified models taught in class into their proper context.

Fair Trade follow-up

Following up on last month’s post about libertarians and Fair Trade coffee, it’s worth noting that leading roaster Counter Culture Coffee has released its annual transparency report for its Direct Trade certified beans. It’s available here in PDF format and is very cool. For every coffee in the program it tells you which employee visited the farm, when they last visited, the price paid for the beans, the beans’ cupping score, the number of years CCC has been buying from that farm, and a paragraph-length description of their work at each location. You really can’t beat that level of transparency.

To put the numbers in context, here’s a quick summary: The minimum price required for Fair Trade certification is $1.26 per pound. Counter Culture’s Direct Trade certification has a minimum of $1.60. The actual lowest price the roaster paid last year was $1.65. They paid as high as $4.45, with many coffees falling somewhere above $2 or $3.

As I said before, I’m not reflexively against Fair Trade, but I don’t want consumers to think it’s the best or only game in town. When you put that program up against the Direct Trade programs of the best specialty roasters it’s easy to see why many coffee lovers prefer the latter model.

[Via @CoffeeGeek.]

The Watts case and jury nullification

I’ve been following, from a distance, the case of Canadian sci-fi writer Peter Watts. Watts’ car was searched at the US border and he was beaten, pepper sprayed, and detained when he questioned the purpose of the search. I’ve refrained from commenting until all the facts were out, but with the trial concluded there’s little to vindicate his treatment and the government’s refusal to release video of the incident lends no credence to the case against him.

A jury convicted Watts of resisting customs officials. Fortunately the sentencing judge chose not to imprison him. Read Peter’s own account for a humorous take on the hearing, his friend’s for a more touching one.

One of the jurors who convicted Watts went so far as to advocate against a jail sentence. Regrettably, the jurors felt that they had no choice but to throw Watts at the mercy of the judge. Two quotes from jurors:

As a member of the jury that convicted Mr. Watts today, I have a few comments to make. The jury’s task was not to decide who we liked better. The job of the jury was to decide whether Mr. Watts “obstructed/resisted” the custom officials. Assault was not one of the charges. What it boiled down to was Mr. Watts did not follow the instructions of the customs agents. Period. He was not violent, he was not intimidating, he was not stopping them from searching his car. He did, however, refuse to follow the commands by his non compliance. He’s not a bad man by any stretch of the imagination. The customs agents escalted the situation with sarcasm and miscommunication. Unfortunately, we were not asked to convict those agents with a crime, although, in my opinion, they did commit offenses against Mr. Watts. Two wrongs don’t make a right, so we had to follow the instructions as set forth to us by the judge.

And:

Peter,

I believe your description of the trial and deliberations is more accurate than you could know. As a non-conformist and “libertarian” (who has had some experiences not unlike yours) I was not comfortable with my vote, but felt deep inside that it was consistent with the oath we took as jurors. I believe nearly all the jurors searched for a legitimate reason to vote differently. In the end it came down to the question “Was the law broken?”. While I would much rather have a beer and discussion with you than Officer B. I never the less felt obligated to vote my conscience. I also believe most, if not all, the jurors sincerely hope that you are handled with a great degree of leniency, we, unfortunately have no say in that matter.

It’s great that Watts was lucky enough to have a sympathetic judge but tragic that the jurors who convicted him felt compelled to do so. If there is ever a time for jurors to stand up against prosecutorial indiscretion it’s in cases in which the defendant has been abused by agents of the state. Cases like this are exactly why we have citizen juries. It’s not enough to convict and hope that, as happened here, the judge will make the right decision instead of siding with his fellow authorities. Even though Watts avoided a jail sentence he will have to bear the costs of a felony conviction, including infringements on his right to travel.

Unfortunately current law generally forbids discussion of jury nullification within the courtroom. I encourage everyone who may serve as a juror to read up on their rights and responsibilities so that they can render an informed verdict should they sit on a case such as this one.

Previously:
Oregon’s low bar for conviction
Filan doesn’t go far enough
Dawkins doesn’t get juries

A quick Tax Day post

In typical fashion I put off doing my taxes until tonight. That’s a solid 12 hours ahead of when I did them last year. In untypical fashion, I knew where I’d put all the paperwork needed to complete them. It’s almost like I’m becoming a real adult.

This year was also notable for being the first in recent memory in which I’m receiving a refund, though for the regrettable reasons that I did no paid freelance writing in 2009 and took a capital loss on a mutual fund that I had to sell while recovering from my move cross-country. If I’d realized I was getting a refund I’d have filed sooner. While I’m happy to discover I have a check coming my way, Megan McArdle helpfully explains that getting refunds is not a good thing:

Getting a “refund” on your taxes means that you have just made an interest-free loan to the government. Do you relish the opportunity to make interest-free loans to anyone else, just for the sheer joy of eventually getting your own money back? I hope not.

As it happens I generally only give interest-free loans to people with guns and prisons at their disposal.

I wrote last year about my desire to abolish mandatory withholding entirely. Read the whole thing here or just this excerpt from Charlotte Twight about how withholding manipulates taxpayers to increase the size of government:

We have seen that, on many levels, income tax withholding increases transaction costs to the public of understanding the magnitude of the income tax and of opposing it politically. Government officials always have regarded withholding as a seemingly “painless alternative” (U.S. House Hearings 1980: 35). Lacking an understanding of the concept of present value, many taxpayers do not perceive that withholding causes the real burden of their tax liability to be greater. Indeed, the common practice of overwithholding associates the payment of taxes with an apparent financial benefit rather than cost, distorting taxpayers’ assessments of the actual costs and benefits of government activity. Consistent with a transaction-cost-manipulation model, the expected return of such overpayments makes people feel “happier’” about sending in their tax returns on April 15. The very mechanism of withholding deflects blame from the government by requiring employers to initiate and bear the cost of the forcible extraction of people’s income. Piecemeal collection each payday from income the taxpayer never sees obscures the magnitude of the annual tax. And, because it is a forcible extraction, it raises the transaction costs to the public of expressing political resistance to taxes by not paying them.

And on a lighter note, here’s Reason’s Nick Gillespie and Meredith Bragg reminding us that all this tax money is at least going to a good cause:

Libertarians and Fair Trade coffee

Henry Farrell asks:

[...] why are so many libertarians opposed to fair trade coffee?

It would seem to me that fair trade coffee is fairly hard to argue with on the principles of consumer sovereignty (i.e. the claim that consumers know their own interests best, and are able to realize them through the market mechanism). If consumers want to pay a premium for coffee that has been produced ‘fairly,’ then this should be no more troubling for libertarians than consumers wanting to pay a premium for e.g. luxury chocolate (which often is made from the same basic material as very-good-but-not-horrendously-expensive chocolate), and arguably less troubling.

Then Jim Henley piles on too:

Where I was going with that when planning out the post is, if one isn’t careful, the appreciation of the ironic power of self-interest to fulfill social needs can slide into, first credulity – there’s got to be an irony in here somewhere! meaning, almost anywhere – and then decadence: mere contrarianism. At worst, contrarianism that isn’t just sloppy but smug: proud of itself for asserting ironical, “politically incorrect” claims that widely recognized beliefs and decencies are actually myths and vices. Tee hee! Look how upset everyone gets when I tell them how wrong they are to hold their comforting nostrums!

They’re both right that Fair Trade is just another form of voluntary free trade and that the hostility some libertarians express toward the idea of paying more for coffee to help poor farmers is distasteful at times. However at the risk of being one of those smug contrarians Henley dislikes so much, I’m going to defend the libertarians on this one. Partially, anyway.

The simplest reason to object to Fair Trade coffee is that it’s just a stupid name. It suggests that all other coffee is unfair and exploitative. As a sign at one coffee shop I visited put it, “Fair or Unfair? It’s that simple.” Well, it’s not that simple. And if, as I do, you think the insights of Adam Smith, David Ricardo, and other economists are hard-won intellectual achievements, then a label that implicitly opposes those ideas is going to rub you the wrong way. This could have been avoided if we labeled Fair Trade as something like “Charity Coffee” instead, which would be more accurate and avoid disparaging any economic theories. But then it might not have caught on as well because buying it wouldn’t let people signal their opposition to globalization, which brings us back to why so many libertarians dislike Fair Trade in the first place.

That’s probably as far as your average capitalist goes in his reasons for disdaining Fair Trade coffee. But if you’re actually into coffee, you know that some of the smartest critiques of Fair Trade are coming from good-hearted liberals working in the industry. They’ll tell you that Fair Trade is out of step with the current market for specialty coffee.

The first complaint you’ll hear about Fair Trade is that it doesn’t do enough to encourage quality. I’ve had some very good Fair Trade coffee and I’ve had some that’s terrible; the label doesn’t promise anything. It sets a price floor without any real link to cultivating better beans or promise that the roaster knows how to handle them. Even worse, by mandating a co-op model of production, Fair Trade can reduce incentives for individual farmers to improve their crops. This may not matter if consumers are buying Fair Trade coffee just for charity, but over the long-term they may not continue paying more for the label if they’re not perceiving higher quality in the cup.

A bigger objection to Fair Trade is that it’s no longer the best deal for farmers. The Fair Trade minimum of $1.26 per green pound is often higher than commodity coffee prices but well below what premium coffee roasters will pay. For example, Counter Culture’s Direct Trade program pays a minimum of $1.60 per green pound with additional incentives for exceptional crops.

There’s much more one could say in criticism of how Fair Trade certification works; there’s no need to repeat them here but see this recent Guardian article or Kerry Howley’s excellent piece from Reason a few years ago if you’re interested.

What’s frustrating about the successful branding of Fair Trade is that it’s used as a cognitive shortcut by consumers for what qualifies as an ethical coffee purchase. I speak from experience selling coffee in Washington’s Georgetown neighborhood. The type of customers some libertarians enjoy mocking would often come in asking for Fair Trade beans. Sometimes I could engage them and explain that what we were offering was better than Fair Trade, that farmers got more money for the beans and the quality of the coffee was outstanding. Other times I couldn’t and they walked out for another shop, likely ending up doing less good for farmers and with a worse cup of coffee. Customers’ loyalty to Fair Trade can be just as uninformed as some libertarians’ knee-jerk opposition to it.

Here’s Jim again on why Fair Trade seems like such a bad idea to people who’ve taken to heart Adam Smith’s lesson that following one’s self-interest is often the best way to do good in the world:

[...]something like Fair Trade will seem like it should be the kind of thing where there must be a catch. Here are people trying to act out of benevolence and still getting dinner! It would make perfect sense – and be a lot of fun! – if these do-gooders were actually doing harm.

But by this point, you can start getting lazy. Like, assuming that fair-traders must be screwing up “price signals” that are the market’s way of telling poor foreign farmers to stop farming.

I’m not convinced that buying Fair Trade actively does harm, though excess production is a legitimate concern. If you’re shopping at Costco and debating between a big bag of Procter and Gamble’s regular coffee or their Fair Trade beans, you’re probably making some farmer marginally better off by choosing the latter. Fair Trade may play a useful role in mass market coffee. However if you want to pass the maximum of your purchase price onto coffee farmers, your best bet is to buy the highest quality coffee you can from roasters like Counter Culture, Intelligentsia, or Stumptown (to name the usual three, though there are many others).

In fact, it doesn’t even matter whether you care about coffee farmers or not. If you selfishly pay for quality in the cup you’re very likely buying beans that brought more revenue to them than Fair Trade would have. Adam Smith was right and so, sometimes, is the libertarian’s ironic intuition.

Alcohol taxes and the Overton window

We boozehounds on Twitter were abuzz today about a proposed California ballot initiative that would drastically increase taxes on all forms of potable alcohol:

A new initiative that would increase the tax on alcohol was cleared for signature gathering today by the Secretary of State’s Office. And it’s not a modest tax increase, it’s huge. Tax on a six-pack of beer would increase from 6-cents to $6.08. And say goodbye to two-buck chuck–a tax on a 750 ml bottle of wine would go from 4-cents to $5.11. And the tax on a 750 ml bottle of distilled spirits would increase from from 65-cents to $17.57.

I find it hard to believe that this would pass in a state that has so much riding on its alcohol industry and I think that’s sort of the point. Consider the idea of the Overton window:

The Overton Window is a concept in political theory, named after its originator—Joe Overton—former vice president of the Mackinac Center for Public Policy. It describes a “window” in the range of public reactions to ideas in public discourse, in a spectrum of all possible options on an issue. [...]

Overton described a method for moving that window, thereby including previously excluded ideas, while excluding previously acceptable ideas. The technique relies on people promoting ideas even less acceptable than the previous “outer fringe” ideas. That makes those old fringe ideas look less extreme, and thereby acceptable. The idea is that priming the public with fringe ideas intended to be and remain unacceptable, will make the real target ideas seem more acceptable by comparison.

Now it’s possible that the sponsors of this initiative, Josephine and Kent Whitney, truly believe this is a reasonable tax increase. But I doubt that winning the vote is the only goal of this initiative. The aim is to get lots of news coverage for their far-out idea and thereby make smaller tax increases seem reasonable by comparison. So if you don’t want them to succeed, don’t take them too seriously.

Additional note: The Overton window is often described in a very cynical, manipulative context. In contrast, the late Joe Overton’s peers at the libertarian Mackinac Center use it to explain how think tanks can change public policy for the better. They see shifting the window as the noble aim of libertarians working in a world often hostile to free markets and individual liberty. As Nathan Russel wrote for the Center:

A long-term focus on shifting the Overton window allows a think tank to follow its ideals and perform a genuinely positive public service, instead of being constrained to merely advocating those policies that are currently possible. When the window of political possibilities is moved along the political spectrum, the impossible becomes desirable and the simply desirable becomes imperative. This is the true influence of a think tank — shaping the political climate of future legislative and legal debates by researching, educating, involving and inspiring.

[Hat tip to Rumdood, who tweets, "Look, I'm OK with a modest increase in taxes on booze, but from $.65 to $17.57 for a 750mL bottle of rum is insane." Manipulation of the Overton window in action? See also Jeff Woodhead and Chad Wilcox on the Overton window and health care reform.]

Health care reform’s unseen costs

Chad Wilcox nicely sums up why many libertarians lament the passage of the health care reform bill:

A libertarian professor I know once said he believed that libertarianism’s greatest intellectual contribution is a recognition of the unseen. We’ll never see what open competition could have done to health costs in markets for health care left free of government interference. We’ll never see how the voluntarily uninsured would have spent the money they’re now required to spend on plans. We’ll never see how many lives could have been saved or how much healthier we could be in a world with technological innovations that are more costly and burdensome to develop as a result of government. I’m not saying there will be no technology and no innovation, I’m saying when we make these choices “as a society ” we sacrifice the unseen what-could-have-been for a “bird in the hand is worth two in the bush” philosophy that defies the most basic tenets of economics.

Like many libertarians, I think it takes a remarkably credulous faith in government to think that this bill is fiscally responsible. But what really disappoints me about it is that it fundamentally rejects the sort of reforms I’d favor and puts up new barriers to their enactment. Specifically, I’d like to see us move away from insurance as the primary means of paying for routine health care. This bill takes the opposite approach with its individual mandate that everyone purchase insurance, immediately inviting aggressive lobbying on behalf of providers to expand minimum levels of coverage. It additionally weakens Health Savings Accounts first by increasing the penalty for making non-health care related withdrawals, then by further limiting the amount people can contribute to them. One of the few nods in the direction of penalizing excessive insurance is the so-called “Cadillac tax” and it doesn’t even go into effect until 2018 so who knows if that will survive.

The seen costs of this health care bill will become all too apparent in the deficits to come. It’s the unseen costs of making it much harder to try out the market-oriented ideas of people like Milton Friedman, Michael Cannon, Arnold Kling, and yes, John McCain, that are most depressing.

Previously:
Bartenders for McCain?

The problem of progressive arrogance

Rich Rodgers had a post at Blue Oregon this weekend lamenting the fact that some people stubbornly refuse to get on board with the public option for health insurance. He suggests that in the face of such irrationality there’s nothing to do now but agree to disagree. Maybe he’d have more luck convincing his opponents if he treated them with a little more respect. Here’s his opening:

Free market economists use models that assume that people are given complete information and make rational decisions. How absurd. No one has complete information, most people have terribly unreliable information, and people make stupid decisions all the time. Witness the election of George W. Bush in 2004.

There are many intelligent people who describe themselves as free market economists. One or two of them have probably noticed that in the real world people don’t have perfect information. Yet those silly economists persist in their crazy beliefs! Perhaps that’s because they realize that simplified models are often useful starting points for understanding the world. The arguments of free market economists don’t depend on perfectly informed buyers and sellers any more than the designs of engineers depend on perfectly frictionless surfaces.

If Rodgers bothered to look into what libertarian economists actually think he’d see that it’s often the absence of perfect information that drives them to support markets. If knowledge was easily obtainable there’d be little reason not to hand over power to enlightened planners; we’d just figure out what’s efficient and do it. Unfortunately no one person or agency has that much information, so we use markets and price signals to coordinate the dispersed and incomplete knowledge of market actors.

At the risk of being overly generous, I’m assuming that Rodgers doesn’t think we should set up public options to pay for our groceries, our oil changes, our TV sets, or any of countless other goods we consume on a daily basis. We manage to handle these transactions fairly well on our own despite our lack of omniscience. In some arenas, at least, the free market model works pretty well. It’s possible that health care isn’t one of them, but Rodger’s opening canard doesn’t provide any reason for thinking so.

Ironically, one of the leading arguments against free market health care is that consumers have too much information, causing adverse selection and the unraveling of insurance markets. That’s a challenging point! Alas, it’s not the sort you bother making when you start from the assumption that your opponents are stupid.

(It’s also telling that Rodgers’ example of uninformed, stupid decision-making was the election of George W. Bush, a decision that was political, not economic. In the political sphere people are free to make stupid choices because the personal cost of being wrong is virtually nil. This is a reason to be skeptical of further politicizing health care.)

But that’s just the first paragraph. After Rodgers unfairly dismisses free market arguments he goes on to say that people who oppose the public option are dupes of the insurance companies:

The insurance industry is massively funding the campaign against health care reform, especially reform that includes an option for publicly administered insurance. They want to keep making a lot of money, so they prefer to keep things the way they are. The industry is abetted by its mouthpieces on Fox News, talk radio, and in the op-ed pages of the Wall Street Journal. Their teams of strategists are rolling out some rabid crusaders to try to stop the conversation, apparently encouraging them to use tactics as close to brute force as the law will allow (and then some).

This illogical outrage and outrageous behavior obviously didn’t spring up overnight, it’s been cultivated for years by political strategists and interest groups on the right. The rabid dogs know what they’re doing–they know their role, even if they can’t control themselves. If you sat these birthers and screamers and Glenn Beck fans down and asked them to explain how the universe is put together, the story you heard would be scary and wrong, but they would believe every word of it.

While it rests uneasily on an old foundation of philosophical principles, the right’s current ‘platform’ on health care is a twisted-up mess of distortions and opportunity-driven sound bites. It makes very little sense for an ordinary working person to adopt a stance against public health insurance–what exactly is so great about private health insurance?–but rational decision-making has nothing to do with this. People are committed to being on a team, and they will fight for the team.

It’s great sport to mock the fringe elements of one’s ideological opponents — and the conservative movement certainly deserves some mocking right now — but picking on the nutjobs is no substitute for engaging with actual arguments. And if Rodgers looked beyond FOX News he’d find that arguments do exist. Free market economists have a coherent perspective on health care that’s in fact deeply critical of the current system. And the reforms they suggest, such as expanding HSAs, shifting the tax exemption for health insurance from employers to consumers, and eliminating barriers to competition among states, are logical extensions of that perspective, not cover for the interests of insurance companies.

Does Rodgers consider those arguments? Or does he instead suggest that his opponents are a bunch of country rubes? If you guessed the latter, you’re correct!

The current debate in DC has focused on 1) a national public option for everyone or 2) state-by-state decisions on whether a public option is available. Neither of these approaches successfully take into account the reality that people are bitterly divided on the issue, and will stay that way. One answer to the dilemma might be to create a national public health insurance option, but give local communities the choice to opt in or out. Union County can vote in or out. Multnomah County, same choice. Equity can be ensured via the tax code.

It’s a foregone conclusion that the major urban areas will all opt in. Both coasts will be in. In parts of the country where the political divide is intense, communities will have their say; e.g. rural Georgia will probably be out, and Atlanta will opt in. With most cities in, the population base will be plenty large enough to ensure maximum bargaining power. And the conservative communities that are whipped into a frenzy can sit this one out.

I’m picking on Rodgers here, but only because his post exemplifies the tendency I’ve seen in many progressives to ignore the best arguments of their opponents, focus on the extremes, and assume that ordinary people who disagree with them are victims of their own ignorance. This is its own kind of tribalism and with that attitude it’s no wonder disagreement seems so intractable.

I’m not writing this post to defend any particular perspective on health care. I obviously lean to the libertarian side, but this isn’t an area in which I claim any expertise. All I’m suggesting to progressives is that if they want to win over skeptics like me, demonstrating that they’ve engaged with free market arguments would be a better place to start than insulting our intelligence.

Smoking bans and libertarian failure

What a surprise for me to wake up to this morning: Other bloggers are writing about smoking bans! Marc Ambinder got the ball rolling, but Megan McArdle’s post is of the most interest:

[The lack of smokefree bars] seems like a market failure. You can explain it through preference asymmetry and the profitability of various customer classes: heavy drinkers are more likely to also be heavy smokers, and they are the most profitable customers. Bar owners don’t want big groups of people who are going to take up three tables for an hour and a half while nursing one white wine spritzer apiece. They want people who are there to drink. In a competitive equilibrium, they couldn’t afford to go non-smoking because they’d lose their most profitable customers to all the other bars.

You can explain it, but this doesn’t seem like a good market outcome by any measure. Let me be clear, I’m still against the smoking ban, even though I personally vastly prefer smoke-free environments; I think interfering with property rights like this has even heavier costs. But I also recognize that I’m in a minority. And I think that politically, if not intellectually, the success of smoking bans is a heavy blow to libertarian credibility.

It’s true that in pre-ban cities it could be frustratingly difficult to find good smokefree bars, but I wouldn’t go so far as to say this is a blow to libertarian credibility. For several reasons the market failure Megan describes is somewhat illusory.

First, trends toward smokefree businesses were already in place in many jurisdictions before their smoking bans took effect, especially in areas that were late to pass them. Smokefree DC’s website listed more than 200 non-smoking, non-fast food restaurants in the city limits prior to DC’s ban. My tally from a similar list here in Oregon showed more than 400 smokefree bars and restaurants in Portland in December 2008, one month before our statewide ban took effect. During recent debate about Virginia’s upcoming ban the Virginia Hospitality and Travel Association reported that 67% of restaurants were already voluntarily smokefree, a number that included many nightlife spots. Markets are providing smokefree options, just not with the immediacy and completeness that health activists prefer.

Another limiting factor is that it’s hard to measure actual smoking preferences solely by the popular support of smoking bans. There is no cost for a non-smoker to loudly proclaim a preference for smokefree environments when the opportunity arises to attain them by force. Even if a person has only a slight preference for avoiding smoke exposure, he has no reason to oppose a ban (unless he values quaint ideas like respect for property rights, freedom of association, and diversity). As I’ve written before, a non-smoker’s revealed preferences may be very different:

To find out if people really demand smokefree spaces you have to offer them some trade-offs. Are they willing to travel a little further to avoid smoke? To go to a slightly more expensive place? To go where the crowds are less hip? If not, then they probably don’t really care about smoking, even if they say they do in the abstract.

Of course, there’s no need to set up experiments to figure this out. The experiment was conducted thousands of times each day among the competing bars and restaurants in, for example, pre-ban DC. The conclusion they reached is that some smokefree establishments can be viable, but that most people either enjoy smoking or tolerate being around it. Owners would probably have continued to shift toward smokefree policies over time, but there’s no good reason to think that the slow trend in that direction was out of touch with actual consumer preferences and needed to be hastened by a ban.

These considerations cease to matter when smoking policies get taken out of the realm of economic trade-offs and into the realm of winner-take-all politics. With a smoking ban on the table, previously tolerant individuals become rabidly anti-smoker. They exaggerate their annoyance with tobacco smoke. Perhaps they even fool themselves about the true extent of their dislike, given that before the ban they made few attempts to find smokefree alternatives to their favorite hangouts. With non-smokers in the majority, they face little opposition to imposing their will on the smoking minority.

In that post I stated the issue a little too strongly. Some people (like Megan) really do have deeply held non-smoking preferences and bar owners take time to notice and respond to changing consumer demand. However, the discrepancy between people’s stated and revealed preferences should make one cautious about describing the situation as a market failure, and certainly not as a failure that can only be corrected by making every business smokefree. (DC Councilwoman Carol Schwartz’s proposed tax credit to businesses that forbid smoking would have been a much more sensible remedy.)

I do think Henry Farrell is correct to note that prominent early smoking bans helped create a sudden shift in norms. By changing expectations and spreading fear of secondhand smoke they made non-smokers much more willing to demand smokefree environments, whether by denying their patronage or through the political process. But this is not a failure of markets or of libertarianism; before the norms changed markets were probably doing a fairly good job delivering what their customers felt they could justifiably demand.

Also, while the success of early bans in changing norms is a testament to government’s occasional ability to enact social change, it is not a point in favor of further bans. Now that a market for smokefree bars and restaurants is firmly established, the case for comprehensive bans in jurisdictions that do not have them is much weaker. So is the case for existing bans; their work completed, they should be loosened or repealed to allow the preferences of smokers to once again find expression in the market.

Update: Jonathan Adler weighs in with a similar argument. Stephen Bainbridge reflects further on the ability of law to alter social norms. Patri Friedman explains how California’s ban triggered favorable changes in Vegas poker rooms.

Update 2: Brad Taylor puts the argument in graph form.

Motorhome Diaries update

The guys have published the full account of their detainment and it reflects some pretty appalling treatment from the Jones County police, including being pepper sprayed, having their vehicle searched without consent, and being locked up without being read their rights, being informed of the charges against them, or allowed to contact help. Read it all here.