(02-06-2019 01:03 PM)RiceLad15 Wrote: Agree about some on the left, but we'll disagree about how many would find that heretical. I think the majority just don't view unfettered capitalism as the answer to problems the way the right tends to portray it. Even Adam Smith recognized that government played an integral role in society to a certain point, yet it feels as if the right thinks the invisible hand is the best and ultimate arbiter for all issues facing modern society.
I don't know anyone--left, right, or center (if we still have a center)--who believes in "unfettered" capitalism. As you note, even Adam Smith, the intellectual granddaddy of "unfettered capitalism," recognized some role for government.
Let's try this definition of what a classical liberal thinks government should do, from Friedman, Milton, Capitalism and Freedom, pp. 34-36 (40th anniversary edition), noting that the words were originally written in the mid-1960s and therefore some specific programs mentioned may be anachronistic:
"A government which maintained law and order, defined property rights, served as a means whereby we could modify property rights and other rules of the economic game, adjudicated disputes about the interpretation of the rules, enforced contracts, promoted competition, provided a monetary framework, engaged in activities to counter technical monopolies and to overcome neighborhood effects widely regarded as sufficiently important to justify government intervention, and which supplemented private charity and the private family in protecting the irresponsible, whether madman or child—such government would clearly have important functions to perform. The consistent liberal is not an anarchist.
Yet it is also true that such a government would have clearly limited functions and would refrain from a host of activities that are now undertaken by federal and state governments in the United States, and their counterparts in other Western countries. Succeeding chapters will deal in some detail with some of these activities, and a few have been discussed above, but it may help to give a sense of proportion about the role that a liberal would assign government simply to list, in closing this chapter, some activities currently undertaken by government in the U.S., that cannot, so far as I can see, validly be justified in terms of the principles outlined above:
1. Parity price support programs for agriculture.
2. Tariffs on imports or restrictions on exports, such as current oil import quotas, sugar quotas, etc.
3. Governmental control of output, such as through the farm program, or through prorationing of oil as is done by the Texas Railroad Commission.
4. Rent control, such as is still practiced in New York, or more general price and wage controls such as were imposed during and just after World War II.
5. Legal minimum wage rates, or legal maximum prices, such as the legal maximum of zero on the rate of interest that can be paid on demand deposits by commercial banks, or the legally fixed maximum rates that can be paid on savings and time deposits.
6. Detailed regulation of industries, such as the regulation of transportation by the Interstate Commerce Commission. This had some justification on technical monopoly grounds when initially introduced for railroads; it has none now for any means of transport. Another example is detailed regulation of banking.
7. A similar example, but one which deserves special mention because of its implicit censorship and violation of free speech, is the control of radio and television by the Federal Communications Commission.
8. Present social security programs, especially the old age and retirement programs compelling people in effect (a) to spend a specified fraction of their income on the purchase of retirement annuity, (b) to buy the annuity from a publicly operated enterprise.
g. Licensure provisions in various cities and states which restrict particular enterprises or occupations or professions to people who have a license, where the license is more than a receipt for a tax which anyone who wishes to enter the activity may pay.
10. So called "Public housing" and the host of other subsidy programs directed at fostering residential construction such as F.H.A. and V.A. guarantee of mortgage, and the like.
11. Conscription to man the military services in peacetime. The appropriate free market arrangement is volunteer military forces; which is to say, hiring men to serve. There is no justification for not paying whatever price is necessary to attract the required number of men. Present arrangements are inequitable and arbitrary, seriously interfere with the freedom of young men to shape their lives, abs probably are even more costly than the market alternative. (Universal military training to provide a reserve for war time is a different problem and may be justified on liberal grounds.)
12. National parks, as noted above.
13. The legal prohibition on the carrying of mail for profit.
14. Publicly owned and operated toll roads, as noted above.
This list is far from comprehensive."
I can justify some of the above specific programs on practicality grounds, but would not be opposed to having this discussion about the necessity for any of them.
And, of course, in the intervening years, a number of other programs have arisen to which Friedman's classical liberal would take great exception. In this regard, I am thinking primarily of large income and wealth redistribution programs, which have failed miserably at both their stated goal of ending poverty and their implicit goal to equalize the distribution of wealth and income. I can and often have justified the creation of a guaranteed basic income, using Freidman's own negative income tax or the conceptually similar Boortz-Linder prebate/prefund, and Bismarck universal private health care, to create a floor to protect against falling into the basement of poverty. But those would be floors, available to all, and not designed, nor supported by tax structure designed, to redistribute large amounts on income and wealth.
In my opinion, it is at the point of massive income and wealth redistribution that systems become collectivist/redistributionist. You may want to call them socialist (government owns means of production) or communist (in theory, workers own means of production, but that has never happened) or fascist (nominal private ownership of means of production, but with government micromanagement), but they are all peas in the same pod. All of them feature power concentrated in a central government supported by force, which is required to enforce the blatant and widespread taking of wealth or income from one and giving it to another. All of them exhibit militaristic and racist tendencies.
The Nordic systems are not redistributionist at heart. Yes, they have broad social programs and high tax rates for top incomes. But everybody, including the wealthiest, receives the benefits of those social programs, and everybody pays for them though consumption taxes and through fairly flat--but very high--income taxes. In Sweden, the top tax rate is about 57%, but you hit 52% at somewhere around $60,000 and that top rate kicks in at about $80,000. They are more capitalist with an extremely high floor, and one that is very costly. Everyone benefits and everyone pays. They are arguably more fascist than socialist.
