Twenty Years Later

Here's a bit from an article by Joshua Muravchik a right wing indeologue writing in a right wing journal talking about how the world is twenty years after the collapse of Communism. This first bit talks about Robert Heilbronner, one of my favourite historical economists. I love his book The Worldly Philosophers. It is well worth reading even today.

I'm ambivalent about the whole article, but I do like this bit:

Nineteen eighty-nine was a most extraordinary year. There are other years that are imprinted on historic memory, but most of them were occasions for horrible events (1917 or 1939) or disappointing ones (1789 or 1848) or the conclusions of great tragedies (1648 or 1945). The year 1989 was that rare moment when dramatic things happened that were overwhelmingly beneficent. As we watched the world change before our eyes, we learned many things. Looking back today on how the world has evolved in twenty years since that momentous time, we can distill several additional insights.

The economist Robert Heilbroner wrote in 1989: “Less than 75 years after it officially began, the contest between capitalism and socialism is over: capitalism has won.” This outcome reflected a startling reversal because as recently as the decade before, socialism—considering all its diverse forms lumped together—seemed at the apex of its global sweep, apparently confirming Marx’s prophecy that it was not merely desirable but destiny.

Heilbroner’s observation was noteworthy because he himself was not unsympathetic to socialism, and doubly so because he was no Communist. Given the hostile breach between Communism and democratic socialism, why should Heilbroner have conceded that the fall of the Soviet empire was tantamount to the end of socialism? Why did he not accept the claim advanced by some socialists that the end of Communism would only clear the way for a purer form of socialism?

Heilbroner saw how much the allure of socialism rested on the eschatological claims that Marx had made for it. Democratic socialists may have disdained—even detested—the Soviet version, but the fact that systems calling themselves “socialist” had proliferated around the world seemed to confirm the claim that history was marching inexorably away from capitalism toward something newer and presumably better and more efficient. Whether or not Lenin and Stalin interpreted Marx correctly, their enshrinement of him as the patron saint of a mighty empire gave his theories an unsurpassed weight in twentieth-century thought.

Heilbroner also saw that the fall of Communism culminated a trend. With social democratic parties having already forsaken the dream of replacing capitalism and with the developing world having realized that markets rather than state planning offered the surest path from poverty, the Soviet collapse sealed the issue. Socialism was finished.

Has the economic meltdown of 2008–09 reopened the question? Is socialism on the table again? Not at all. It only shows that you can always have too much of a good thing. The fact that free markets are the best mechanism for making economic decisions does not imply that freer is always better. The smooth functioning of the private sector depends on government to maintain a legal framework, to protect the public against unscrupulous behavior, and to provide vital goods that are not profitable for the private sector to furnish. Libertarians who dream of an economy entirely free of government are no less utopian than socialists.

That last paragraph is what caught my eye and has my agreement.

I agree that libertarians are utopian crazies. The real path forward is not the right wing politics of Muravchik or left wing ideologues. It is a careful picking our way forward using ideas from both camps. What the left has right is that a society is not just an accidental collection of individualists. What the right has properly understood is that concerns for social welfare have to align with our deepest commitments which are to self, family, local community, and spread out from there. Both sides need to recognize that freedom of thought and individual dignity are very compelling forces.

The required compromise is some blend of a framework and incentive. The government must frame laws to bind people together an ensure social justice. The government must support a value system that recognizes and encourages individual responsibility and the supports the fundamental bedrock of society: the family. Ideologues on left and right fail to see the two pillars.