An exchange with Lawrence Auster about the possibility that the European Monetary Union might dissolve, and with it much of the impetus of the more general socialist project embodied in and effectuated by the EU, got me thinking about what would happen if the European or American government apparatus were simply to disappear. What would happen, in other words, if the whole thing were just to collapse? Sure, there would be a huge dislocation, millions of government workers thrown out of a job, etc. But, would it not also, after a while, usher in an era of much increased prosperity for the affected populations, in rather the same way that the collapse of Soviet style communism worked to the ultimate benefit of the East Germans, Czechs, and Russians?
This led me to some more general considerations.
There are three sectors of any economy: the portion of it that is good, the portion that is real, and the portion that is fake: the good economy, the real economy, and the fake economy, characterized by work and products that are good, real, or fake.
People who work in the good economy produce goods and services that people want and value, and that are truly good for them; goods and services that promote human flourishing, and that, ipso facto, are properly ordered to the Good Himself, as His Nature and Will are expressed everywhere in nature, and in the natural law. Those who produce, e.g., nourishing, delicious comestibles and well-made, beautiful clothing work in the good economy. If your work product is elegant or handsome, and does no harm to those who use it, you can be pretty sure you are working in the good economy. Such work is captured in the Buddhist notion of right livelihood.
Almost everyone aspires to do good work, and tries to find in their work something that is good, which they may then emphasize.
The real economy includes the good economy. People who work in the real economy produce goods and services that people want and value, but that may or may not be truly good for them. Porn is the best example I can think of. People want it and value it, but it is not truly good for them. Abortion and sex change operations are pretty good examples, too. They are interesting because, as with any other product, they can be either excellent or shoddy. Excellent porn or abortions are in the same relation to the Good as an excellently made road that leads over the edge of a high cliff.
Almost everyone does some work that is real but not good; almost every human engagement, however much real value it provides, is not wholly good.
Then there is the fake economy. People who work in the fake economy produce things – I hesitate to call them “goods and services” – that no one wants. No one would spend his own money on the stuff they produce, if he had a choice. Most such work involves complying or enforcing compliance with legal, regulatory, or bureaucratic policies and procedures, and demonstrating and documenting such compliance, and complying with policies and procedures for documenting compliance, and so forth. Once you get started with this sort of work, there’s no bottom to it. Then there are all the professionals who help with compliance: accountants, consultants, attorneys, compliance software firms, etc. Government regulators and those in the private sector who specialize in dealing with government regulators – including tax agencies – are all part of the fake economy.
Each of us who so much as files documents with government agencies or pays taxes does some irreducible amount of fake work, and almost every job involves some fakery.
By its very nature, all fake work increases the cost of doing business for everyone, so that the cost of real goods is higher, and fewer really valuable goods or services are either produced or enjoyed.
Because it aims policy at social goals that cannot be achieved in this universe, or that are flatly incoherent or contradictory, liberalism promotes the fake economy. Libertarianism promotes the real economy. Traditionalism is interested to promote, or restore, the good economy.
How does the American economy stack up? Not well. It’s a fair bet that about 40% of the American labor force is producing fakes. Most government employees are doing fake work. In the banking industry, more than 50% of the labor force is devoted to compliance activities, rather than banking operations; in the health care industry, the ratio of time spent on paperwork to time spent on patient care is 50/50.
Think about the scale of that lost opportunity: about 40% of our labor force is working at producing stuff that no one wants. How much wealthier would we all be if that labor, year over year, decade after decade, were devoted instead to the real economy? And if that extra real wealth had been compounding, with some percentage invested, think how much greater our total social capital would be, and thus our labor productivity (i.e., our earnings). The mind reels.
What is worse, much fake work is expended in pursuit of social objectives that cannot be achieved, such as equality. Not only is the work fake, not only does it represent opportunity lost and resources squandered, but it perverts and deforms society by forcing it to adapt toward unreality. It is probably fair to say that most fake work is aimed at improving social performance in pursuit of real and attainable goals, increasing the cost of the really valuable activities we would undertake even in its absence, so that we are doing real work less efficiently. But peculiarly liberal or leftist sorts of fake work force us to waste social resources in pursuit of unattainable goals, that we would never otherwise seek. They force us to degrade our social performance for no really operative reason: that is, they force us to do fake work less efficiently.
But note that even if there were no fake economy, so that the whole economy were real, as the libertarian urges, then while it would certainly be far more prosperous than it is today, it would not thereby be rendered good. One can’t measure goodness simply in terms of what people want; after all, some people want to kill themselves. Utilitarianism is fine as a guide to life and to policy, provided that most people’s utility functions are not too perverted by sin and error. Unfortunately, this means that utilitarianism is no good as a guide to life or policy: our utility functions, as individuals and as a society, are deeply whacked. Freudians would say that people are more or less deranged or neurotic; Christians, that they are more or less depraved. Same thing, effectually.
The libertarian argues, correctly, that the pervasive operation of natural law in and among a population of free agents will result eventually in the discovery and uncoerced, bottom-up adoption of forms of social order that promote the true good, the true welfare and flourishing of the people, and in a preponderant, unforced conformity thereto. Sin being more or less lethal, it is self-limiting. Libertarianism allows death to do the works of justice that humans have traditionally delegated to governments. And there is no question that the libertarian strategy would work: in the long run, we are all dead, as Lord Keynes and Ecclesiastes both remind us.
Well and good; but it will take a long time for that fruit to ripen – the harvest will be ready at about the same time as the eschaton is completed – and in the meantime there will be much suffering (when we are unguided by prior reasoning, suffering is how we learn how we ought to behave). Until its citizens learn virtue, society will be weakened by vice, so that it will be easy prey. It’s a price we needn’t pay, because humanity has already paid it: we already know how to organize a society – how to legislate morality – in such a way as to promote human flourishing. Traditional morality gives us all the main points of the necessary policy.
Where there is in respect to the finer points of policy any doubt remaining, a simple thought experiment can quickly tell us whether a given option ought to be ruled out. All we need to do is ask ourselves, as between two otherwise completely similar societies, and holding all other things equal, if one of them allows the behavior in question while the other does not, which of them will prevail. Such questions generally answer themselves.
Notice that the question is not, what policy would be nicer or more fair, but what policy would be prudent – would, i.e., lead to the prosperity and prevalent success of society against its competitors, and vis-à-vis the challenges posed by the natural environment. Such questions of policy confront any form of government. The issue, then, is not whether legislative authority ought to be, or is optimally, vested in a monarch, an oligarchy, or a Parliament, or whatever; for any such authority would have to make the same decisions about policy. When we ask what form government should take, we should understand ourselves as asking which form of government would be most likely to make prudent policy – i.e., policy that leads us, individually and corporately, toward the Good.
The first such question, in the order of logic, is whether a society ought to have a government at all. As between two otherwise identical societies, which will prevail: the one that is governed, or the one that is not, at all? Like I said, the question answers itself, no? Even a poorly governed society can conquer territory occupied by far more prosperous and happy, but uncoordinated freeholders, who can in the nature of things have no foreign policy or war-making power.