Saturday, 11 February 2017

A Libertarian Paradox?

A friend, Tim Reeves, recently came up with what he claims is something paradoxical about libertarianism:

"They claim the market should work for itself as government can't understand its inner workings (which is probably true) and yet how do libertarians know the market will work if no human mind can understand it?"

I've been tentative about the so-called libertarian brand before, but for now let's stick with the populist understanding. While I have sympathy with Tim's interpretation, I don't think his paradox is as much of a paradox as he thinks.

Before I explain why, let me first say that I can think of a couple of elements of libertarianism that could be loosely be thought to be paradoxical. One such example is that libertarians desire the shrinking of political influence to a fraction of what it is now, but in being so averse to the state they may lack the political clout to influence from the inside. Another example, although admittedly a looser paradox, is that the freedoms libertarians welcome involve embracing a society open enough to contain many elements it finds to be inimical to the values it espouses.

But Tim's enquiry regarding how libertarians can know the market will work if no human mind can understand it doesn't strike me as being much of a conundrum, because in being asked to understand how the market works we are only being asked to understand that the market is society's aggregation of individual decisions by buyers and sellers made by people for whom those decisions brought about a mutual benefit.   

That is to say, while Tim is quite right that the free market is too vast and complex for politicians to understand its inner workings, it doesn't follow that because of this libertarians are on dodgy grounds assuming the validity of their position, because all us pro-market people are trying to say is that a free market in action must, by definition, be a system working for its agents, because it is quite simply the accumulation of activities that work for those agents.

There may well be unpleasant things in society that result from free market transactions, and concomitant power laws that cause discomfiture to certain socio-cultural groups, but us pro-market people are not primarily selling the qualities of the market per se - we are trying to advocate the freedoms from which things like the market operate more fruitfully.