The Future

Liberty is not a means to a higher political end. It is itself the highest political end.

Lord Acton

While it can be a dangerous business to forecast or predict the short term, Boyes outlines a number of issues that pose structural threats to the US economy. We have previously blogged on regime uncertainty resulting from the increasing scale and scope of government action. This regime uncertainty presents a threat to society in two dimensions. The first is to decision making by the wealth creators in society. As scope and scale of centralized planning and direction increases the complexity and unpredictability of government coercion (think the current health care debate, funding for adventures in the middle east, etc) wealth producing decision makers will alter plans in such a way as to adversely impact productive investment. Using Baumaol and Powell's phrase - productive entrepreneurship will be reduced and replaced by wealth destroying entrepreneurship as individual decision makers respond to the incentives of centralized "planning" to maximize well being. (think here of Duke Cunningham, Ben Nelson or any K streeter).

The second dimension is articulated by Acton over on Beacon by Art Camden. The threat to liberty from expansion of centralized and coercive action by the state is, as Acton recognized, the overriding threat to a way of life that is free.

Acton again:

The danger is not that a particular class is unfit to govern. Every class is unfit to govern. The law of liberty tends to abolish the reign of race over race, of faith over faith, of class over class.

Regime uncertainty is a necessary byproduct of state action, this action by its nature must be coercive. So liberty will always be the casualty of state action. But even more troubling are the consequences of regime uncertainty. As the mass of individual decision makers experience greater uncertainty they must confront a fear of the unknown reach of the state. This fear enables the state to encroach on private life in response to the demand of the masses to alleviate this fear. So a self generating mechanism accelerates the process of state coercion. (TSA responses to "threats", privacy invasions from the Patriot Act and other legislative efforts are contemporary examples that follow in the tradition of Lincoln's civil war "justified" abridgements, the Wilson/Palmer actions against dissent, JE Hoover as the embodiment of the end result of power, . . . well the list goes on,

This latter example is a penetrating example of the clear and present danger Acton found in coercive state action:

Great men are almost always bad men, even when they exercise influence and not authority: still more when you superadd the tendency or the certainty of corruption by authority.

So, Boyes and I concur on the long term consequences on The Road to Serfdom, a path that public policy predicts "leaders" will be incentivized to tread and that the masses will be incentivized to demand.

Stepping back and looking beyond our borders, is there any ray of hope? In a world of Chavez, Morales, Kim and the cabal of African thugs is there any reason to be positive?