Thursday, October 09, 2008

Naomi Klein Speaks Out Again

Ever the reliable enemy of free markets, Naomi Klein speaks out on how the financial crisis has discredited neoliberalism.

Now, I admit to being a journalist. I admit to being an investigative journalist, a researcher, and I’m not here to argue theory. I’m here to discuss what happens in the messy real world when Milton Friedman’s ideas are put into practice, what happens to freedom, what happens to democracy, what happens to the size of government, what happens to the social structure, what happens to the relationship between politicians and big corporate players, because I think we do see patterns.

Now, the Friedmanites in this room will object to my methodology, I assure you, and I look forward to that. They will tell you, when I speak of Chile under Pinochet, Russia under Yeltsin and the Chicago Boys, China under Deng Xiaoping, or America under George W. Bush, or Iraq under Paul Bremer, that these were all distortions of Milton Friedman’s theories, that none of these actually count, when you talk about the repression and the surveillance and the expanding size of government and the intervention in the system, which is really much more like crony capitalism or corporatism than the elegant, perfectly balanced free market that came to life in those basement workshops. We’ll hear that Milton Friedman hated government interventions, that he stood up for human rights, that he was against all wars. And some of these claims, though not all of them, will be true.

But here’s the thing. Ideas have consequences. And when you leave the safety of academia and start actually issuing policy prescriptions, which was Milton Friedman’s other life—he wasn’t just an academic. He was a popular writer. He met with world leaders around the world—China, Chile, everywhere, the United States. His memoirs are a “who’s who.” So, when you leave that safety and you start issuing policy prescriptions, when you start advising heads of state, you no longer have the luxury of only being judged on how you think your ideas will affect the world. You begin having to contend with how they actually affect the world, even when that reality contradicts all of your utopian theories. So, to quote Friedman’s great intellectual nemesis, John Kenneth Galbraith, “Milton Friedman’s misfortune is that his policies have been tried.”

Will Wilkinson responds here.

Wow. Here is Klein’s method. Take a famous thinker you really don’t like. See if they’ve ever had a meeting with anyone who is responsible for anything bad. Blame it on the thinker. Seriously. That seems to be about the extent of her investigative journalist rigor. You never saw Paul Bremer as a Friedman type? I guess you’re no investigative journalist.

Remember when Hugo Chavez was spotted at the UN thumbing through a copy of Noam Chomsky’s Hegemony or Survival? We can only assume that Chavez has been busy implementing Chomsky’s ideas. Sure, it might not be what Chomsky had in mind, but when you leave the safety of academia and start issuing policy prescriptions, and heads of state read your books in public, you no longer have the luxury of only being judged on how you think your ideas will effect the world. Sure, you can say that Noam Chomsky is one of the world’s foremost defenders of a critical free press. But then why did Chomsky disciple Hugo Chavez seize control of Venezuela’s mass media? Ideas have consequences, Noam.

Wilkinson effectively dismantles the ridiculous notion that thinkers are somehow responsible for all the misuse of their ideas. Thinking about it now, this is exactly the same sort of arguments some radical creationists use to discredit Darwin- Hitler was a Darwinist, so evolution must be wrong. That ideology is used in the pursuit of less than noble goals is hardly news. It's basically the story of human history.

In her speech, Klein makes the point of holding ideology responsible for real world consequences, be it holding Friedman responsible for Chile and Iraq, or holding all Marxists accountable for the crimes of Soviet Russia. It's a neat little trick, but the real problem here is how Klein attempts to portray economic policies and human rights issues are viewed hand-in-hand, in such a way that radical socialists and radical free marketers can be dismissed on the same basis. So never mind the evidence that nationalized economies don't work, Stalin killed a lot of people, so he's a bad guy, just like those radical free market types.

What Klein misses completely is that socialism in practice did not work as an economic theory, never mind the human rights abuses. And the fact is that there is no similar record when it comes to free markets. What we have around the world today are market-based economic systems, regulated in different manners and to varying degrees. Klein is perfectly free to join the debate over the relative merits of various forms of regulation, but that's not what she's been writing or speaking about.

To return ever briefly to my favorite topic of regulation, allow me to point out that most free marketers are dismissive of regulation not because of blind ideology, but because of the visible record of inefficiency and outright failures. And on a purely general level, free marketers can rest on that position. But for those like Klein, who are constantly arguing for regulation, there really is no flip side, unless one really wishes to make the point that all regulation, no matter what it is, is good regulation. No, the fact is that if you're arguing for the government to do something (like regulate), you bear the burden of laying out just what that regulation is. All the free marketers can do is respond.


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