Thursday, April 30, 2009

Private Public Transportation

Our cities need to make a strong and clear distinction: transportation that serves the public does not need to be provided by the public. We should encourage “private public transportation.”

Nationwide, the current regime penalizes private providers of public transportation services. “Medallion” systems strictly limit the number of taxis in our cities while charging a massive tax on taxi ownership. Bus companies face even stricter limitations: most cities prohibit private bus services unless they serve a strictly private function (such as university transportation).

Sometimes such restrictions are directly discriminatory. In the 1950s (I think) there was a black-owned and operated bus company serving black residents of Harlem and Brooklyn. In the name of “efficiency,” the city outlawed this company. Its services were not replaced; those communities were simply not deemed worthy of “public” transportation.

But even in the absence of such civil-rights violations, limiting public transportation to public companies is a disaster for our cities.

Public transportation is an enormous good for cities. For those who cannot afford a car, it provides the only means of travel: for work, shopping, entertainment, visiting, and more. The freedom of those without cars is strictly limited by the provision of public transportation.

But even for those who can afford a car, public transportation is a great good. Consider this: we would pity anyone who spends more than two and a half hours a day – 10% of their time – in the car. But that means that every car spends 90% of its time sitting unused. What would our neighborhoods, our workplaces, our shopping areas look like if we did not have to provide parking for cars that spend most of their time idle? What would our cities look like if we could eliminate even half of our traffic, with its noise, pollution, and above all, roads?

How would our cost of living change – especially the cost of rent – if most of our parking and half of our roads were made available for other uses? How would our quality of living change if there were half as many lanes of traffic every time we crossed the street? Yet that would require only two people in every car that now carries one.

If anything, we should be subsidizing public transportation—private buses and taxis—rather than taxing them and limiting their numbers. At the least, we should facilitate them.

Here is a proposal. For public safety, private taxis and buses (and any other form of private public transportation) should only be required to register, carrying a clearly visible sign that they have passed a background check. (The background check should be provided free of charge, as a minimal form of subsidy for this public service.)

For the convenience of riders, public-transport vehicles should carry a clearly visible explanation of fares. The city might register a few standardized fare charts: a red badge, for example, might mean $1.50 for unlimited travel (a bus fare); a yellow badge, $2/person, plus .20/mile(taxi fare) —or whatever. But there is no reason that providers should not determine what fare system works best for them, so long as it is clearly visible. If the goal is to get more providers involved, city governments should not dictate terms.

Current bus routes could be maintained – and expanded. Publically operated buses could even continue to run on current schedules, until proven unnecessary. The addition of new providers, however, would greatly improve service. Rather than waiting 20 minutes for the next bus, one might find another provider coming along the desired route in 2 minutes. If the provider is a car rather than a bus, one might even go direct to one’s stop instead of waiting for other people to be picked up and dropped off.

The city could allow private drivers to purchase fare-card readers, for a reasonable charge. Some drivers might prefer to be cash-only, as taxis now are. But others might offer their customers the option to pay by credit card or fare card. I know I would prefer that option – though there are times I would take the fastest car available.

This proposal would cost cities little. If the new system takes business away from the old buses – by providing cheaper, faster service – publically-operated bus companies would lose fares, but could run fewer buses. Since publically-operated buses currently run at a net loss, the city would come out ahead. The city would lose the revenue from the sale of taxi medallions. But if taxis became more widely available, and cheaper, cities could sell off some parking facilities, which are inevitably located in places where people want to be, and thus where real estate prices are high.

Above all, such a system would benefit the people of a city, providing greater mobility, lower costs of living, and higher quality of life. These things are worth the loss of taxi-medallion revenue.

Of course, such a system might not work. Perhaps there is no one who wants to get into this business. But if that is so, there is no reason to outlaw private public buses. If taxi driving was not a good business, there would be no need to limit the number of medallions, and no way to explain the astronomical prices paid for them. Cities would do well to put people first, and give private public transportation a chance.

Monday, April 20, 2009

Liberal Fascism?

Jonah Goldberg has a popular book out right now -- I think it was the number-one non-fiction seller on Amazon -- called Liberal Fascism. I like Jonah Goldberg a lot, so I'm interested in his point of view (though I'm concerned there's some human solidity missing: Buckley minus any religious or high-cultural sensibility is not Buckley).

And there is clearly a very important point here, made strongly in Paul Johnson's classic Modern Times. (I haven't read Goldberg's book, but I've read enough to be pretty sure it's the same idea.) The point is basically this: standard wisdom says socialism and fascism are opposite ends of the spectrum. Therefore (since, I guess, there must be a simple spectrum) the farther one gets from socialism, the closer one gets to fascism. Particularly, anyone who is opposed to Big Government must be more or less a fascist.

But wait! Nazi is short for National Socialist. Fascists are socialists. And not only in name. Fascism is not anti-government -- that couldn't be farther from the truth. Fascism is about big government, about everything-inside-the-state, nothing-outside-the-state. Hitler had a lot more in common with FDR than with Barry Goldwater.

Now, this is a really important point. Hitler is unthinkable apart from statism. One of the greatest arguments for limited government -- made especially in Hayek's classic The Road to Serfdom -- is precisely that as the state grows, in tends to demand more and more, and be less and less tolerant of outliers. Big government is always bad for minorities; it may be coming for the rich and the Mormons now, but it will come for you eventually, as you fail to participate (be assimilated!) in the ways the state wants you too. Compulsory public education, for example, is a lovely tool for the Hitlers of the world, who cannot tolerate minority opinions. So is a state-dominated economy: they come for the CO2 now; what will they find intolerabe tomorrow?

So fine, fascism is a kind of socialism.

Nonetheless, Goldberg's Liberal Fascism argument has a crucial flaw. The flaw is essentially this: he tries to tarnish liberalism -- which is a kind of socialism -- with what's bad about fascism. But what's centrally hated about fascism is precisely the way it is different from liberalism. It's like saying, "Jacob and Esau are the same, because they're from the same family!" But the problem is, they relate to that family in opposite ways. What makes Esau reprobate (wish I could think of a non-theological example!) is not that he's Isaac's son, but that he's a bad son. What's bad about fascism (in the popular estimation) is not that it's socialist, but that it's national socialism.

I'm reading the first volume of Churchill's history of World War II -- that's the volume about the political lead-up; I'll read the military-history volumes another time, maybe. I just got to Churchill's summary of Hitler's philosophy; very nicely done.

Hitler was first and foremost, not a socialist, but a nationalist. Hitler believed in the German people. He hated everything that was internationalist. His hatred of both the Jews and Communism was precisely because they were international, not bound to the genius of a particular people -- specifically, the German people. He was a socialist, concentrating power in the state, precisely to strengthen the nation, the Volk. He believed the nation's strength was in struggle (Kampf), in fighting against other nations. He wanted war to make his nation strong.

Hitler is hated, not because he was for big government, not because he was a socialist, but because he was a racist, killing the Jews, and a war-monger, conquering his neighbors. I'm sorry, Mr. Goldberg, but it is simply absurd to try to smear this on liberals -- as much as I hate liberalism! It is like saying, oh, look at those chess pieces, they're both kings, they're just the same. No. One is black, one is white. They are opposed. Someday I'll study logic and know the technical name for this fallacy, but let's call it a smear: you say that because A is like B in one respect, it must be alike in all respects. Not so fast! Especially when the critical respect is precisely the one where A and B are opposite.

Liberalism is internationalist. Liberalism denies the genius of the American people. And you know, conservatism exalts the genius of the American people. "American exceptionalism," by itself, bears much more resemblance to the critical aspect of fascism, nationalism, than do liberal desires to be liked by Europe and the Middle East, to abandon the American Constitution for international law, to give up on our language and heritage and political philosophy in favor of what everyone else is doing.

And of course, the whole movement of "conservatives" (I don't think it is genuinely conservative) against immigration is much more akin to fascist concerns about racial and cultural purity than it is to liberal desires to water down anything distinctive about America. (Anti-immigration "conservatives" claim to be worried about illegal immigration, but if that were the case, the simplest answer would be to liberalize our immigration laws; instead, most of this clique wants to tighten the laws, and explicitly appeals to arguments about cultural purity, as well as the economic danger of outsiders; the latter argument is so manifestly anti-market that it seems clear these folks are really driven by the cultural argument.) Unfortunately, that's where the immigration argument is being played out: on cultural purity.

Conservatives are right to want legality; conservatives are right to oppose more-or-less open liberal efforts to water down American distinctiveness by promoting non-assimilating immigration. But when conservatives take the side of Big Government (fences, crack-downs on businesses, more militarization, stricter scrutiny of who deserves to be part of America, based especially on central-planning economic criteria) in order to maintain cultural purity, they have no right to claim that the liberals are fascists. Nationalist socialism: big government used to preserve the Volk: that is fascism.

The rest of conservatism, however, is at least as unlike National Socialism as liberalism is, because fascism needs the State in order to pursue its kind of nationalism. The irony of calling conservatives facists (apart from the immigration debate) is that conservatives appeal to a Constitution that rejects racial purity in favor of liberty. Conservatives want a country in which the government can't crack down on minorities, in which minorities of every kind flourish. Conservatism is based on this idea of limited government; and nothing more undermines the purposes of fascism than limited government. Hitler would never accept limited government. Limited government can't invade its neighbors and gas its minorities.

There is a very strong argument to be made that Unlimited Government tends toward fascism. Even Stalin, the great Internationalist leader, ended up a fascist, killing more Jews than Hitler, cracking down on dissenters, limiting travel and free speech and universities. This is the real Liberal Fascism argument: not that the essence of Nazism is socialism -- it isn't; the essence of Nazism is nationalism -- but that socialism, Unlimited Government, inevitably contradicts internationalism, because it inevitably ends by stifling dissent, the free movement of peoples and goods (notice that our Big Government folks are terrified of free trade), and the creativity of the people. Liberalism intends to use Big Government to make the world more tolerant; but the lessons of Stalin -- and Mao, and everyone else who has tried, even our homegrown anti-marriage,* public-education liberals -- is that the Dictatorship of the Proletariat ends up being more and more Dictatorship and less and less Proletariat; the attempt to eradicate intolerance ends in the greatest intolerance; the move to make the world fair and happy through force makes things more arbitrary and dreary than ever before.

International Socialism is, at its root, as opposed to the Nationalist part of National Socialism as Black Queen to White Queen. But by seeking its internationalist ends through socialist/Unlimited Government means, it ends up as intolerant as Hitler. The question, however, is not whether Internationalists and Nationalists are essentially the same -- they aren't! -- but whether the means, Unlimited Government, tends to pervert the ends to which it is directed. That is an argument better made, I think, by Hayek than by Goldberg.

*Is the defense of marriage Limited Government? Liberals -- genuinely confused on this, I think -- believe that marriage laws are an attempt to impose a particular culture, Christianity, on others. The association of Christianity with particular culture is already odd, from a historical perspective, pretty dumb. And of course it's worth noting that at this stage of the game, a central part of the argument is about self-determination, about whether courts can overrule the overwhelming voice of the people and a couple states can overrule the opinions of other states. Nonetheless, the key point is whether liberals are right that heterosexual marriage is merely the preference of a particular culture.

In brief, the response is no. First, heterosexual marriage is a product of nature, evolution: children need parents, both biologically and, therefore, socially. This has nothing to do with culture, everything to do with reason. And since heterosexual unions are universally the cause of new citizens, it does have to do with securing the rights of every single individual (we all begin as children) against those who would treat those individuals themselves as someone else's "right": the right to adopt, to call yourself a mommy when you aren't, to deprive a child of a parent, etc.

Second, and maybe more important, marriage is just a Thing. There is, simply, something out there that is Marriage: the commitment of the two biological partners in procreation to create an environment in which procreation can reach its natural end, adulthood. The real argument against gay marriage is not anti-gay, but pro-marriage.

The equality argument here is really upside down. Gays say they want the same rights everyone else has. But they have the same rights: they can enter into a heterosexual marriage if they want; the fact that they don't want to do that is not a deprivation of their rights (at least not in the political order). What they, in fact, want is to take away the rights of others to enter into marriage; what they are asking for is an elimination of a particular Office in the polis, not its expansion. They want to deny that there is any such thing as Marriage, by replacing the definition of that Thing, in politics, with a new one.

The proponents of "traditional marriage" don't always speak this clearly -- though democracy should not require you to speak clearly -- but in fact, heterosexual marriage is simply the right of citizens to enter into the most fundamental contract in the political order and to have that contract recognized by law. Eliminating the right of people to make that contract is a usurpation: Government stepping in where it doesn't belong; as in many things, it abandons one of the necessary functions of Limited Government in favor of a new intrusion of Government into life: in this case, Government redefining the pre-existing office of Marriage. Marriage law is a matter of Limited Government, not fascism.

Wednesday, April 1, 2009

A Twenty-First Century Idyll

Here's the bad news:

Our country is living beyond its means. It has been for a long time, though it spiraled out of control in the last decade. There is a sense of magic, as if the government can keep taking more debt and, since it hasn't failed yet, it never can. But of course that is silly. "Too big to fail" is a moralism, not a statement of fact: we may desperately want big things not to fail, but ultimately the only way to save them is to appeal to something bigger. Unfortunately, the buck stops with Uncle Sam: who can bail out the bailer?

Without someone to bail him out, an individual (or an institution) eventually has to pay his debts. At some point, even the most bogus credit card will no longer lend me money. I will have no more to spend, and those to whom I am obligated will want to be paid back. Without someone to bail me out, I will certainly never have money of my own again -- the lenders will make me pay back the last cent. And perhaps I will suffer violence, from those who are frustrated.

Yet the lenders themselves face the same predicament. If the bank keeps lending money to people who cannot pay it back, the bank itself will not be able to pay back legitimate investors. The bank itself will fail. The investors will lose their money, the bank will lose its good name -- and perhaps there will be violence, from those who are frustrated.

This is the truth in the bail-out mentality: bad debt is a social disease, because it always involves a lender. If I cannot pay back my debts, that hurts me -- but it also hurts everyone who loaned money to me. And if it gets out of control, and even my lenders are bankrupted, it hurts everyone who loaned to them, too. We have to do something!

But there is a lie in the bail-out mentality, too. That lie is that government evades the logic. Government lends money to bail out bad debt. Uncle Sam is giving money to those who made bad mortgages, to those who invested in those who made bad mortgages, etc. But where does Uncle Sam get the money? One source is investors: Uncle Sam just acts like another bank. But when a bank lends to debtors who can't pay back, the bank fails. The US can sell a lot of Treasury Bonds, but ultimately, people want to get their money back, with interest. Whether it is down the street or in Washington, if a bank borrows money from Tom, lends it to Harry, and then cannot get it back from Harry, then Tom will not get his money back. Tom suffers -- and he stops putting his money in the bank. The flow of Treasury-Bond revenue may be fine for now (maybe), but it will not last forever. We have to do something about our debt problem, that is true -- but taking more debt, or passing the debt around, does not fix the problem. Lending money to people who can't pay it back is the problem.

Of course, the difference between Uncle Sam and any other bank is that Uncle Sam can just print more money. But this is purely a ruse. Printing more money devalues money. If I get my $200 back, but now it doesn't buy a week's groceries, I'm in trouble. Investors know this: when it becomes apparent that Treasury Bond yields will be paid back only with massive inflation, people will stop buying Treasury Bonds. But more to the point, all the people who have bought Treasury Bonds will be in need of a bail-out themselves. If I think I can fund my retirement on funny-money inflationary Treasury Bonds, I'm going to be in big trouble when I retire.

We have a debt problem. We are living beyond our means. There is a limit to how many times Daddy can bail us out -- and there is a limit to how many people can bail Daddy out. At some point, bail-out ceases to be an option. At some point, we run out of money. At some point, we lose the house, and the SUV, and we have to work instead of retiring. The only solution to living beyond our means -- the only solution to bad debt -- is to work more and cut spending. I am not talking about only at the federal level. Uncle Sam will have to cut spending, sure -- but so will we.

Being a recent Ph.D., I have no investments, no savings, no assets, so all of this doesn't affect me. Except that it affects my employers. Bad debt is a social disease. I was just hired at a university -- and I need that income! But if all the parents who pay for kids to go to college -- and pay my salary -- have to cut back, it may be me who gets cut. If Uncle Sam no longer has money to hand out for scholarships and financial aid, my salary dries up. Bad debt is a social disease. Eventually we all have to cut back our life styles, and learn to live a more meager existence. We can't just keep taking loans we can't pay back.

If I make $50k a year, but spend $75k, eventually people are going to stop lending me that extra $25k. First, I will have to cut back, and start living at $50k. But then I will have to pay back my debts, and live on less than $50k. Government doesn't evade this logic. Shell games make it all complicated, so that the debt gets shoveled around so quickly that we think it's disappeared: but it hasn't. Everyone eventually wants their investments back, and if they don't get them back, they will stop investing. And if it turns out that, in a great shell game, everyone has loaned everyone else money they didn't have -- why, we all end up in a big mess.

That's the bad news. Eventually we will have to cut back.

But here's an idyllic possibility -- not necessarily likely, but possible, and hopeful. Perhaps when the reckoning comes, when the debt bubble bursts, and we all have to come to terms, perhaps we will take stock of what's really important. Hitting rock bottom can do a person a lot of good. When the debt-collectors come for the McMansion, and the big screen tv, and the SUV, there's always the possibility that we'll say, you know, what really matters is my dog, my kids, and the softball league. (Or whatever.) You move to a much smaller house, sell the SUV, make the kids share a bedroom, and focus on what really matters.

What would this look like on a social level? Here's a trivial example. Right now, our society spends an awful lot of money on food. There's the whole organic movement -- leave that aside for a moment -- but there's also things like grapes from Chile. Now, I like grapes, and I'm glad to have them year round. And in current circumstances, they aren't expensive at all. But it isn't easy to get grapes from Chile to Minnesota. On the most basic level, they have to get on a plane and fly, with refrigeration. But it is far more complicated than that. Thousands of people are employed by the airline, making reservations, fixing planes, fixing runways, making sure that the airplane travels to where a commodity is wanted from where it's available. We do that very efficiently now, so Chilean grapes are cheap -- but only because there is a huge system in place.

This transaction is maintained, moreover, by a massive financial sector. People are busily shuffling money around, from investors to firms, from grocery stores to Chilean-grape middlemen to farmers to farmworkers, etc. This isn't as easy as it sounds. Grapes are cheap now, because there's an enormous industry, countless people working hard, to keep this whole system lubricated. But what happens if the financial system collapses?

For example, the grocery store has to buy the grapes before it can sell them. It does that through investment: I lend money to the grocery store (probably through some Wall St. firm), trusting that a month from now, the grocery store will have used that money to buy grapes, then sold those grapes at a big enough profit to pay me back with interest. But it's a lot of work to figure out where to invest, what airline is profitable, how much interest to expect. Imagine if the manager of the grocery store had to meet with each individual potential investor, personally process each investment, no matter how big or small, keep track of it all himself, make payments, etc. And imagine if he had to call the guy in Chile, and the airline, and promise them money based on all these individual transactions? This is a lot of work. And it can work only because there is a massive financial sector dedicated full-time to handling these transactions, and guaranteeing that each month the grocer has enough money to buy grapes.

And it is all based on trust. I give my money to the financial sector because I trust they will pay me back. The grocer and the airline and the Chilean grape dealer all trust that contracts will be fulfilled, that the financial guys will put up the money, etc. Imagine if every one of these people demanded cash? It would be impossible. It all relies on trust.

We may be coming to the end of that trust. We may be coming to the end of Chilean grapes. And that is, in itself, bad news.

The good news is, that doesn't mean we have to starve. We put all these people to work so that we can have the specific kind of grapes we want, when we want them, even out of season. But if we ate locally -- I'm not trying to be crunchy here, just economical -- we could cut out an awful lot of middlemen. We could pay cash, and deal with individuals that we really did trust.

We'd lose a lot of processed foods, because they require an enormous network of trust: trust that we'll get what we're supposed to, trust that the factory in Arkansas will actually deliver food to Minnesota, trust that the grocery store will pay back its debts after it sells the frozen lasagna, trust that the financier will come through. We would replace that with a much more local trust: I ask the farmer to deliver me potatoes in the winter, and we trust each other to seal the deal. We would lose a tremendous lot of choice. But we gain more personal business relationships, a more thoughtful consideration of what we value (sell the tv, or the dog? are those Cheetos worth more than the steak?), and more tangible contact with our world.

This would put a lot of people out of work, of course. But here is a central fallacy in many discussions of the free market. It is often said that the free market depends on consumerism, greed, lavish spending. But quite the opposite is the case. The free market is, rather, a way of delegating resources to those activities that are valued. It says nothing whatsoever about what those activities are.

Imagine this: the financial sector falls apart, as do many systems of national trust; the nation as a whole is much poorer, and people radically cut back their spending, to live at, or even below, their means, since debt is no longer an option -- and Hollywood goes out of business. Film, of course, requires a massive financial sector, to invest money before the film starts selling tickets, to get goods, and people, from point a to point b, to distribute the film to where it will be watched, etc. And -- is this too optimistic? -- it's one of the first expenses to be cut. We watch too much television as a nation, but if movies cost $50 a ticket, and all tv was pay-per-view, and expensive, would people really pay? I think not.

So Hollywood goes out of business. Lots of people lose their jobs. But that frees up a lot of hands. Brad Pitt seems to be making between 10 and 30 million dollars per movie. That is an awful lot of work that our society puts into supporting this one man's lavish lifestyle, and pet interests (he recently spent $100,000 fighting for gay marriage in California). Eliminating his job does not hurt the economy as a whole. If he went to work, say, on a local farm, we could all save money not paying for his movies, and he could actually contribute to the local economy. It's not a zero-sum game, even for the minimum-wage stage hand: if he starts making hand-crafted boots, then more hand-crafted boots are available for all of us -- and we have more money to spend on those boots, since we're not paying for stage hands or big-shot actors.

We could spin this out in many ways. But here's my point: first, a reckoning is coming. Our debt problem can only end by all of us spending less money. But the more it flies out of control, the more national systems of trust will collapse: trust in the federal government, in the financial sector, in the grocery industry, etc. That will hurt. But it could mean a positive readjustment, as we shift resources from lavish lifestyles to more basic, and perhaps more human, investments. Perhaps we could eat locally-grown potatoes instead of Chilean grapes or Cheetos, and walk the dog instead of watching Brad Pitt. I don't think that would be such a bad thing.