Quotations

“[T]here is … a real difference between having something rationed by a process and having it rationed by a person.”

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If you design a formula to deny granny a pacemaker, knowing that this is the intent of the formula, then you’ve killed granny just as surely as if you’d ordered the doctor to do it directly. That’s the intuition behind the conservative resistance to switching from price rationing to fiat rationing. Using the government’s coercive power to decide the price of something, or who ought to get it, is qualitatively different from the same outcome arising out of voluntary actions in the marketplace. Even if you don’t share the value judgement, it’s not irrational, except in the sense that all human decisions have an element of intuition and emotion baked into them.

Megan McArdle

UPDATE:

Wow. Megan McArdle’s next post on this topic is even better:

I have voiced my various practical objections to the particular options on the table at various moments. But the main thing is that I don’t want to give the government a greater role in health care markets. Nay, not even if all the other countries . . . well, all the cool countries, anyway . . . are doing it. To the liberals proclaiming that, unlike those of us in the conservative or libertarian camps, they are practical people just seeking the best way to make us all better off, I say: I think your utilitarian calculus is badly wrong.

Most definitely, RTWT.

Quote of the Day

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Chet Richards, in a comment on this thread at Belmont Club:

For an economics professor, Gregory Clark has a very poor grasp of U.S. economic history. The real question is: what have we lost through our current redistributionist (i.e. socialist) policies?
 
LBJ instituted the “Great Society” as a redistributionist scheme. I well remember that at the time critics were saying that LBJ’s program was grossly underfunded and that it would have a very negative impact on the US economy. LBJ not only publicly admitted that the critics were right, he even openly gloated that future generations would just have to live with the consequences. On top of LBJ’s ego we had to suffer from the adoption of the “Limits to Growth” policy that was enacted in the early 70’s by liberal neoluddites including Nelson Rockefeller’s gang (and Richard Nixon). This policy choked off growth during the 1970’s by doubling the Capital Gains Tax.
 
So what have we lost? The long term economic growth of the US from its founding to 1970 was 4.5% through thick and thin. Growth losses during recessions and depressions were compensated by growth overshoots during the recovery period. Since the population was also growing, the per capita growth rate works out to about 3.5%. In 1970 the long term per capita growth rate dropped to 1.5% and has remained at that level ever since. (These days an annual total GDP growth of 4% is regarded as phenomenally good!)
 
Working the numbers for the period from 1969 to 2009 we have a per capita GDP growth of 4x with a 3.5% per capita growth rate. With the true per capita growth rate of 1.5% the per capita growth during this period was actually 1.8x. If we had not had LBJ and “Limits to Growth” our per capita economy would now be about 2.2x larger than it currently is. Factoring in the population growth gives us about the same ratio.
 
Conclusions: 1) Almost all of us have suffered a profound loss of the prosperity that should have been ours. 2) Revenues to the Government would have been substantially larger than they currently are and taxes would have been much lower. 3) Inflation would have been much lower which means our savings would not have been eaten away (and taxed) by inflation. 4) Current policies to expand redistribution are going to create even more loss of wealth and increase in poverty.
 
Shed a tear, folks, for what might have been, and what we likely will still lose.

Quote of the Day

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The only universal medicine (Marxists) have for social evils—State ownership of the means of production—is not only perfectly compatible with all the disasters of the capitalist world—with exploitation, imperialism, pollution, misery, economic waste, national hatred and national oppression, but it adds to them a series of disasters of its own: inefficiency, lack of economic incentives and above all the unrestricted rule of the omnipresent bureaucracy, a concentration of power never before known in human history.

Leszek Kolakowski

(Apply it to the current “healthcare debate”, which I put in quotes since one side is desperate to avoid a debate. The shoe fits.)

“…their total inability to admit the possibility of a social order which is not made by political design”

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In Britain and among the English-speaking peoples … Locke’s ideas were simply combined with the old English tradition of limited government. Rather than a project for a new society and a new morality, the English revolution of 1688 and, to a lesser extent, the American revolution of 1776 were basically, though not only, a reassertion of the rights of free Englishman to live their lives as they used to live them before—under the common protection of the laws of the land. In other words, what we now call liberal democracy has emerged in the Anglosphere as a natural outgrowth of existing, law-abiding and moral-abiding ways of life. For this reason, liberal democracy among the English speaking peoples has been naturally associated with an ethos of duty—which, as Burke pointed out, is not and should not be deduced from will. For this reason, too, liberal democracy in the Anglosphere has been tremendously stable. And the English-speaking peoples have always been the first to rise in defence of their cherished liberties—their way of life.
 
In continental Europe, by contrast, the idea of liberty has tended to be understood as an adversarial project: adversarial to all existing ways of life simply because, in a sense, they were already there; because they had not been designed by ‘Reason’. This has generated a lasting instability in European politics. This adversarial attitude, combined with a widespread disregard for limited government, has led European politics to be recurrently dominated by two absolutist poles: revolutionary liberals and later revolutionary socialists, on the one hand, and counter-revolutionary conservatives, on the other. They both have aimed at using government without limits to push forward their particular, and usually sectarian, agendas. Their clash—the clash between the so-called liberal project and traditional ways of life—has been at the root of the historical weakness of European liberal democracy, when compared with liberal democracy among the English speaking peoples. This weakness also explains why, differently from the English-speaking peoples, continental Europeans are not usually the first to rise in defence of our liberties when our liberties become at risk.

João Carlos Espada, Edmund Burke and the Anglo-American Tradition of Liberty (2006)