The General Theory of Liberalism

If foolish consistency is the hobgoblin of little minds, libertarians are small-minded indeed. We believe that people should be free both in their personal lives and in their economic interactions. Any government beyond the minimum necessary to protect life, liberty, and the pursuit of happiness is probably detrimental to those goals.

Modern-day liberalism has not been thought to have such a consistent theme. It appears to be a mishmash of grievance, entitlement, guilt, envy, group identification, deification of elected leaders, and love of big government.

Until now. I believe the unifying theme of modern-day liberal positions is the inability to recognize the incentive effect.

The media and liberals (but I repeat myself) have a myopia where they obsess on first-order effects and do not recognize second-order effects. Incentive effects are a complete mystery to them. A famous example is the do-gooder group that wanted to mandate that parents purchase airline seats for infants. Obviously, on the extremely remote chance that the plane crashes, an infant may be safer to be restrained in a seat than in a parent's lap... assuming that the plane crash is mild enough for people to survive at all. Well, that's all fine and good, but they failed to consider that if you raise the cost of flying by requiring additional ticket purchases, you might price some people out of flying and into driving. And the odds of dying while driving hundreds of miles on American freeways are a lot higher than dying on a commercial airline flight.

This is very similar to the liberal myopia seen on a myriad of public policy issues, such as welfare dependency and the economy-stifling effect of high taxes. Liberals want to treat the immediate symptom without considering the long-term consequences. Take California for example, where the liberals in the legislature think that they can always raise taxes even higher without driving anyone out of business or out of state.

If we ignore the incentive effect entirely, we can arrive at Utopia: "From each according to his ability, to each according to his need." Let's see how that works in California shortly.

While the effect seems strongest on economic issues, it interestingly also applies on non-economic issues. Gun control and criminal sentencing, for example, are both issues where the traditional liberal position is that which minimizes the value of the incentive effect (i.e. crime deterrence).

I'm not saying that liberals are wrong on all of these issues. Indeed, I agree with them in opposition to the death penalty, because I believe the deterrent effect is both minimal and greatly outweighed by other arguments. But it is pretty interesting how well most liberal positions line up pretty well with the blind-to-incentives position.

Come to think of it, the General Theory of Liberalism applies to illegal immigration, too. Amnesty is a perfectly nice thing to do for illegal aliens, but it creates a tremendous incentive for more illegal immigration, especially since 20+ years after the first "one-time only" amnesty, the border is still laughably insecure and we are debating further amnesties more seriously than mass deportations.


webspinner said...

I like to think of the border as the front door to a very large family home. Failing to secure your homes door eventually makes that door a moot point.

K T Cat said...

Great post!

How about this one: Most people see the world as an extension of their own experiences. One of the things that strikes me about the Elites is how they seem to expect responses that they would have. "If we defund the police, we won't see a spike in crime." After all, they aren't deterred by police because they're not bent towards theft and mayhem.

Happy Super Tuesday!