Cosma Shalizi (2011): Extended Harmony, and Tiger Repellent Drumming: "If you want capitalism, but you find a state that powerful very scary... you have a problem.... You might... decide that such power is perfectly A-OK, so long as it's used for ends you approve of and there's no danger of the people taking over. (Hence Hayek's... viewing Pinochet's reign of terror as less damaging to [what he saw as] liberal values than the British National Health Service.) Or you might try to find ways of taming or domesticating state power, of civilizing it. (I think that has a pretty good track-record, but who knows how long we can keep it up?) What you cannot do, with any intellectual honesty or even hope of getting what you want, is pretend that capitalism can work without a powerful, competent and intrusive state. As Ernest Gellner once wrote, 'Political control of economic life is not the consummation of world history, the fulfilment of destiny, or the imposition of righteousness; it is a painful necessity'...

...I should have made clearer that the policies which have been sold over the last few decade as enhancing economic growth have little show for themselves on that score.... These graphs bring to mind... the ancient joke where a new doctor is examining a patient in an insane asylum. The lunatic is compulsively banging on a drum, and the doctor asks why. "To repel the tigers, of course." Doctor: "Tigers? There are no tigers for thousands of miles!" Lunatic: "You see how well it works." If you want to say that the more deregulatory, capitalism-unleashed direction in which policy has moved since the 1980s (or even the late 1970s) is growth-enhancing, you can't point to an acceleration of growth, since there hasn't been any (pace Eugene Fama and John Taylor). Instead, you have to argue, counter-factually, that without those policy changes, growth would have slowed down (even more than it did); that pounding those drums drove away the tigers of stagnation.... At a finer-grained level... one thing which has changed is that aggregate growth does a lot less for most people than it used to. Again, you could tell a counter-factual stories about how all of these would be much worse without those policies, but by this point you are claiming that your drumming repels not just tigers but also snow leopards, elephants, and Glyptodon...


#noted

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