(Cross posted at the Century Foundation’s Taking Note page)
For most of my childhood, I lived in nice suburb near Rochester, NY. Our town included many Holocaust survivors and refugees from the Soviet Union. Inscribed in a notebook at our local Jewish Community Center were names of relatives lost. Our neighbor up the street survived a roundup of Jews by hiding in a wall, listening silently while a neighbor and local police tore the place apart looking for him. At that same JCC, one could find an elderly poet hobbled by injuries inflicted decades before in a Gulag work camp. Many of these men and women lived quietly with memories of staggering trauma and loss. I knew people my own age from summer camp who endured less-homicidal, but still cruel and unjust mistreatment in the Soviet Union.
None of this has anything to do with the subjects I usually write about. It happens to be important to me. It certainly has nothing to do with Medicare’s Independent Payment Advisory Board (IPAB). Or maybe it does.
Last weekend I posted an item at American Prospect lamenting Congress’s deep opposition to IPAB and its unwillingness to address its own misaligned incentives in setting health policy. The guts of my argument were simple:
IPAB attracts bipartisan opposition because it might constrain the ability of Senator X or House Chairman Y to quietly help that local wheelchair manufacturer or academic medical center, to make sure that this national association of orthopedic surgeons or home care providers has proper cover in the legislative process….
In short, we face a massive collective action problem. Every Democratic and Republican policy expert knows that we must reduce congressional micromanagement of Medicare policy. Unfortunately, every Democratic and Republican legislator knows that mechanisms such as IPAB that might do so would thereby constrain their own individual prerogatives.
As Maggie Mahar notes, there’s nothing novel in this argument. Liberals, conservatives, and libertarians have said similar things for years. As I recall, Republicans are rather fond of noting the incompetence and venality of Congress, at least under Democratic majorities.
Apparently, I said something wrong. Yesterday’s Cato Institute blog includes an entry by Michael Cannon, titled “Inside Every Leftist Is a Little Authoritarian Dying to Get Out.” Cannon regards my support for IPAB as literally another step on The Road to Serfdom.
Supplying the requisite slippery-slope Hayek quotations, Cannon intones, “This isn’t how it starts. This is how it snowballs.” No, it isn’t.
It makes no sense, from any ideological or political perspective, for Congress to approach regulation and financing of our health care colossus as a fragmented, rent-seeking mob.
Friedrich Hayek was wrong about many things. I don’t entirely blame him. He wrote under the shadow of Hitler and Stalin, during the most brutal war in human history. He provided genuine insight into the dangers and faults of socialist economic planning. Given that historical moment, Hayek was understandably and forgivably prone to mistake instruments of effective government with more sinister things.
Less forgiveably, since they’ve had seven subsequent decades to think about it, Hayek’s epigones perpetuate the same confusion. They seem determined to overlook democracies’ ability to create wealthy, vibrant, regulated market economies without traveling the slippery slope to totalitarianism or socialist mediocrity.
American social insurance systems are maddeningly incomplete. In places these systems require repair and adjustment—including mechanisms such as IPAD IPAB to address predictably misaligned incentives within our health care political economy. Despite real challenges, social insurance in Western Europe and the United States provides basic retirement, employment, and health security to millions of people. Such security makes a dynamic market economy possible, in no small measure by making that market economy safer and more humane, and thus more legitimate to the ordinary person. Our commitment to treat everyone with mutual respect and decency provides a good foundation for individual freedom, too.
Hayek was right to warn about the dangers when welfare states go too far. He was quite wrong to see this possibility as an inexorable threat to our freedom or one that couldn’t be addressed through democratic means. He was even more wrong to disparage the commitment to freedom embraced by those who hold more egalitarian economic views.
Cannon describes me as a “leftist” and an (aspiring) “little authoritarian.” There is a certain authoritarian mindset in Cannon’s own writing, which flattens basic distinctions between conventional technocratic liberalism and socialist central planning. Unfortunately, the internet encourages and rewards precisely this sort of boorish overstatement.
Ironically, such overstatement trivializes the real blows to human freedom that people have endured, many at the hands of actual leftist authoritarians. Before I get frightened by some panel of health services researchers exploring effectiveness of back surgery, I remember people I know who have seen much worse.
What is ironic is that Hayek’s concept of spontaneous order explains why democracies have not traveled a road to serfdom. He almost saw it himself in his “Constitution of Liberty,” but ultimately didn’t and pulled back from his own insights. My own academic work has often focused on how democracies are usually best understood as spontaneous orders in Hayek’s sense rather than as organizations of rule. But rather than toot my own horn, see John Kingdon’s “Agendas, Alternatives and Public Policy” really demonstrates how democracies can respond to complex issues in a very Hayekian sense. Too bad Hayek didn’t see it, but he has a good excuse. CATO has no excuse whatsoever. Not that this has ever stopped them.
Harold, what the heck were you thinking when you wrote this?
I’m pretty sure that what you mean here is that the Executive branch should have more autonomy to deal with certain domestic matters without micromanaging from Congress and not “HAIL EMPEROR OBAMA!”, but it’s probably best not to put things like this in serious policy pieces either way.
Point taken.
Usually when a person resorts to name calling they lose the argument. Calling someone an “authoritarian” is petty, like saying your mother is fat. It is the sort of emotional argument meant to resonate with people who already agree. Pathetic really.
Hmm. A bunch of private corporations, accountable only to their management and shareholders (if that) deciding how our tax dollars — collected by men with guns, remember — will be spent: just peachy. A group of experts, selected after extensive consultation by elected representatives of the public, deciding how our tax dollars will be spent: authoritarian.
I know it’s hard, but eventually I will understand and become a good libertarian.
This is CATO. They were established for the purpose of destroying Social Security by a ‘Leninist Strategy’. They are Koch-wh*res.
One of the things that’s just been demonstrated by the Birthers is that we should never be afraid to call liars liars, and to call an intellectual br*thel just that.
Collegiality is a two-way street, or it’s just omerta in a respectable suit.
Any structure or device or mechanism by which the public seeks to prevent the mis-direction of the public fisc for undue private gain will be labeled ‘authoritarian’ by the private interests that would like to hijack that public fisc.
It’s a reasonable explanation for most of the Kochery we’re seeing. There’s an invisible hand all right: it’s trying to get a death-grip on public funds.
“Hayek was not an apostle of laissez-faire. He believed in a strong, but limited, state. Government had a duty to provide a social safety net. Above all, it had the task to devise and enforce the rules of competition.” — Robert Skidelsky, “The Road to Serfdom Revisited” (the 2005 Hayek Lecture at the Manhattan Institute for Policy Research
Hayek explicitly endorsed a negative income tax, hunger assistance, and other social insurance programs that today are called “totalitarian” by people who worship Hayek without understanding him. Most Hayek advocates are just Randians pretending to be intellectuals.
(Harold): “In short, we face a massive collective action problem. Every Democratic and Republican policy expert knows that we must reduce congressional micromanagement of Medicare policy. Unfortunately, every Democratic and Republican legislator knows that mechanisms such as IPAB that might do so would thereby constrain their own individual prerogatives.”
(Harold): “It makes no sense, from any ideological or political perspective, for Congress to approach regulation and financing of our health care colossus as a fragmented, rent-seeking mob.”
(Harold): “Apparently, I said something wrong.”
You err in the implicit supposition that Congressional oversight and Executive oversight of the medical services industry exhaust the possibilities. How ’bout a competitive market in medical services and health insurance, with no State-mandated third-party contributions?
(Harold): “Friedrich Hayek was wrong about many things. I don’t entirely blame him. He wrote under the shadow of Hitler and Stalin, during the most brutal war in human history. He provided genuine insight into the dangers and faults of socialist economic planning. Given that historical moment, Hayek was understandably and forgivably prone to mistake instruments of effective government with more sinister things.
Less forgiveably, since they’ve had seven subsequent decades to think about it, Hayek’s epigones perpetuate the same confusion. They seem determined to overlook democracies’ ability to create wealthy, vibrant, regulated market economies without traveling the slippery slope to totalitarianism or socialist mediocrity.”
I read both The Road to Serfdom and The Constitution of Liberty. Have you? I’d say Hayek erred in his confidence that the State could supply a safety net without a consequent erosion in public support for market processes. To the extent that __The Road to Serfdom__ is a product of its time, I’d say Hayek compromised with the dominant statist ethos of his time.
As to “…overlook democracies’ ability to create wealthy, vibrant, regulated market economies without traveling the slippery slope to totalitarianism or socialist mediocrity“, on the contrary, we’re counting on it. The Tea Party and other fiscal conservatives depend on it.
Kevin, thanks for the link. Interesting essay.
I’m still waiting to hear a conservative say something realistic and intelligent about HCR. So far, they’ve got nothing as far as I can tell.
Sometimes think tanks end up writing only for their donors, producing pieces that are not even intended to persuade anyone who doesn’t agree with them already. The best think tanks overcome this risk to intellectual integrity.
Years ago the Economist rated think tanks worldwide for influence, intellectual firepower, creature comfort (accommodations) and some other dimensions I cannot recall. The East-West Center scored high on creature comfort and low on intellectual firepower and influence. Brookings and American Enterprise scored high on influence. Cato scored highest, iirc, on intellectual firepower.
You misunderstand CATO’s point.
They are NOT an intellectual research organization organized around a particular political philosophy: they are a propaganda organ of that particular political philosophy, that is, the “I got mine, Jack, F**K off!” particular political philosophy of the wealthy and selfish elite.
That they can write using words of more than two syllables and sound very authoritative (so long as one doesn’t examine their assertions too closely, or heck, examine them at all!) but they are nonetheless propagandists. It is perfectly acceptable to declare the hyperbolic extremist view of an opposing view.
Expecting an honest intellectual argument from is akin to expecting sanity from a Glenn Beck episode.
(BruceJ): “…that particular political philosophy, that is, the “I got mine, Jack, F**K off!†particular political philosophy of the wealthy and selfish elite.”
Not at all. I recommend Andrew Coulson’s __Market Education__, for example. Cato is basically libertarian, that is, for a government that restricts its role to protection of persons and property, an initial assignment of title, and enforcement of contract law. The “wealthy and selfish elite” are more likely to favor State intervention in their favor (financial bailouts, public sector pension bailouts, etc.).