Date: 2025-05-01 Page is: DBtxt003.php txt00003481
Ideas
Dialog iwth a Michael Strong focus
Is Hayek's Argument for Liberal Government Incoherent? - Coordination Problem
Burgess COMMENTARY
Peter Burgess
Michael Strong
Friday at 9:18pm ·
One of the most interesting paragraphs I've read in awhile, inside baseball from Peter Boettke: 'I know many of my former students --- Chris Coyne, Pete Leeson, Ben Powell and Ed Stringham --- also came to the conclusion during our extended reading and often times heated discussions about Hayek and Buchanan's project that robust constitutions are nonsense, and instead that constitutions are at best focal points around which individuals in a particular society can coordinate. But the idea of constitutions as possessing any 'bite' in social and political affairs is an illusion.'
http://www.coordinationproblem.org/2012/09/is-hayeks-argument-for-liberal-government-incoherent.html
Is Hayek's Argument for Liberal Government Incoherent? - Coordination Problem
www.coordinationproblem.org
|Peter Boettke| I have been reading Stephen Elkin's Reconstructing the Commerical Republic (Chicago, 2006) and I find the book to be very challenging despite my ultimate disagreement with his criticisms of the classical liberal project as I envision it. I...
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Michael Strong Chris Coyne, Pete Leeson, Ben Powell, Edward StringhamProfessor, would be interested in your side of the story here. Friday at 9:21pm · Like
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11 people like this.
Michael Strong Chris Coyne, Pete Leeson, Ben Powell, Edward StringhamProfessor, would be interested in your side of the story here. Friday at 9:21pm · Like
Kelton Baker I've privately contemplated this idea for a long time and have considered a constitution with a predetermined date for the complete dissolution of government. Not just a rearrangement on the theme of continuity, but a planned complete expiration, a sunset date with no renewal. Every day, the urgency of disappearing government would grow more urgent, and people and organizations could plan for its eventual demise by growing and planning organizations and services to replace governmental services, while the problem of entrenched bureaucrats would be forced to embrace free market alternatives for their very survival. Friday at 9:58pm · Edited · Like · 1
Mark Lutter This is why I think Spencer Maccallums work is so important. States fundamentally lack an incentive mechanism. However, proprietary communities overcome this problem because their ownership of the land allows them to capitalize on it. Legislators can costlessly impose damaging legislation while landowners incur the full costs and benefits of rules they require for their land use. The difference between Disney World and Fairfax is exceedingly important to understanding sustainable social order. Friday at 9:53pm · Like · 4
Thomas Faggard Thanks for Sharing This Michael Strong.Interesting on a Micro-Level in Relationships we have Divorce or Dissolution of Marriage.On a Larger Scale Politics perhaps we need Divorce Also concerning Irreconsilable Difference.Political Divorce Period. Friday at 9:55pm · Like
John Strong @Mark Lutter, I too am an admirer of Spencer MacCallum's work and, as you say, his 'land lease community' idea represents an attempt to get the incentive structures right from the foundation up. Constitutionalism also attempts to manage incentives, but in a purely negative way. It does nothing to prevent the capture of the state by rent seekers. Instead, it just tries to Balkanize the state apparatus in an effort to limit the damage rent seekers can do.
Interesting that you mention MacCallum's work in the context of this discussion, because I think local communities are a great illustration of a flaw in the libertarian program. Libertarians are prone to reify the state and then convert it into sacrificial goat that can be immolated and thus carry away all our sins. But home owners associations are a beautiful example of how so-called 'private' covenants can not only take on the trappings of the state, but do so with a goose-stepping vengeance that makes municipalities look like havens of anarchy, and the entire mission in life of a home owner's association is to extract rents from real estate markets as cities expand.
What is a 'state'? We are just as confused about the significance of that word as we are confused about words like 'constitution'. Just as no constitutional document will protect us if the dominant incentives in the political climate are wrong, likewise neither will getting rid of the state free us if we do not have something better to put in the vacuum. Friday at 11:45pm · Edited · Like · 2
Edward StringhamPhd Hi Michael, Good to hear from you. I (and likely my former classmates from grad school as well) believe that limited government is impossible, and that the only hope is to look for private alternatives: ...See More
Hayekian Anarchism by Edward Stringham, Todd Zywicki :: SSRN papers.ssrn.com Should law be provided centrally by the state or by some other means? Even relatively staunch advocates of competition such as Friedrich Hayek believe that the 21 hours ago · Like · 2
Michael Strong Hi Ed, I'm completely on board with your ultimate perspective, and agree with the overall perspective of Hayekian anarchism. On a more practical level, however, I'm interested in the role of legal constraints in bootstrapping our way into that world. For instance, although we were interested in providing a full blown market in law (with respect to commercial law) for prospective Free Cities, in defining the relationship with existing legal entities, such as the government of Honduras, we had to rely on contractual constraints which, in a sense, are similar to constitutional constraints. Until there are clear norms in support of such choice of law, we have to rely on legal permissions that allow choice of law. In the international arena, multi-nationals have de facto exactly such choice of law. How to import the benefits of choice of law as enjoyed by multi-nationals into a small geographic region within an existing nation-state? It seems to me that contractual constraints/constitutional constraints are a necessary path in this context. The idea would be for them to have enough 'temporary bite,' so to speak, to get to the point at which new norms had their own momentum and solidity. (Of course, the Honduran Supreme Court pre-empted even this pathway forward, though we are optimistic than somewhere a similar opportunity will present itself). 18 hours ago · Like
Peter Burgess I come at economic analysis to some extent from an accountant's perspective, and the idea that money profit and the related laissez faire capitalist market system described by Adam Smith in the book he published in 1776 and its invisible hand worked quite well when the world was in an endemic shortage mode, but cannot work as a satisfactory system when high modern productivity creates too much surplus of goods and services while needing rather little wage labor. I am advocating for an accounting reform so that social valuadd is integrated into the accounting of all economic activities so that this becomes just as important as money profit in the process of running capital markets and allocating investment resources. With something like TrueValueMetrics the market system will be able to grow social business and make it possible to serve the 1 billion or more people who are effectively excluded from the prevailing economic market system 18 hours ago · Like ///////////////////////////////// Kelton Baker I've privately contemplated this idea for a long time and have considered a constitution with a predetermined date for the complete dissolution of government. Not just a rearrangement on the theme of continuity, but a planned complete expiration, a sun...See More Friday at 9:58pm · Edited · Like · 1
Mark Lutter This is why I think Spencer Maccallums work is so important. States fundamentally lack an incentive mechanism. However, proprietary communities overcome this problem because their ownership of the land allows them to capitalize on it. Legislators ca...See More Friday at 9:53pm · Like · 4
Thomas Faggard Thanks for Sharing This Michael Strong.Interesting on a Micro-Level in Relationships we have Divorce or Dissolution of Marriage.On a Larger Scale Politics perhaps we need Divorce Also concerning Irreconsilable Difference.Political Divorce Period. Friday at 9:55pm · Like
John Strong @Mark Lutter, I too am an admirer of Spencer MacCallum's work and, as you say, his 'land lease community' idea represents an attempt to get the incentive structures right from the foundation up. Constitutionalism also attempts to manage incentives, but...See More Friday at 11:45pm · Edited · Like · 2
Edward StringhamPhd Hi Michael, Good to hear from you. I (and likely my former classmates from grad school as well) believe that limited government is impossible, and that the only hope is to look for private alternatives: ...See More Hayekian Anarchism by Edward Stringham, Todd Zywicki :: SSRN papers.ssrn.com Should law be provided centrally by the state or by some other means? Even relat... See More 21 hours ago · Like · 2
Michael Strong Hi Ed, I'm completely on board with your ultimate perspective, and agree with the overall perspective of Hayekian anarchism. On a more practical level, however, I'm interested in the role of legal constraints in bootstrapping our way into that world. For instance, although we were interested in providing a full blown market in law (with respect to commercial law) for prospective Free Cities, in defining the relationship with existing legal entities, such as the government of Honduras, we had to rely on contractual constraints which, in a sense, are similar to constitutional constraints. Until there are clear norms in support of such choice of law, we have to rely on legal permissions that allow choice of law. In the international arena, multi-nationals have de facto exactly such choice of law. How to import the benefits of choice of law as enjoyed by multi-nationals into a small geographic region within an existing nation-state? It seems to me that contractual constraints/constitutional constraints are a necessary path in this context. The idea would be for them to have enough 'temporary bite,' so to speak, to get to the point at which new norms had their own momentum and solidity. (Of course, the Honduran Supreme Court pre-empted even this pathway forward, though we are optimistic than somewhere a similar opportunity will present itself). 18 hours ago · Like
Peter Burgess I come at economic analysis to some extent from an accountant's perspective, and the idea that money profit and the related laissez faire capitalist market system described by Adam Smith in the book he published in 1776 and its invisible hand worked quite well when the world was in an endemic shortage mode, but cannot work as a satisfactory system when high modern productivity creates too much surplus of goods and services while needing rather little wage labor. I am advocating for an accounting reform so that social valuadd is integrated into the accounting of all economic activities so that this becomes just as important as money profit in the process of running capital markets and allocating investment resources. With something like TrueValueMetrics the market system will be able to grow social business and make it possible to serve the 1 billion or more people who are effectively excluded from the prevailing economic market system 18 hours ago · Like
Michael Strong Peter Burgess, rather than attempt to solve the problem by means of accounting standards, I see the problem as a matter of creating the institutions needed to internalize externalities effectively and align incentives so that entrepreneurial profits asymptotically approach entrepreneurial value creation. Our approaches are not, from a conceptual perspective, mutually exclusive, and in an ideal world they would be mutually supportive. If you are interested in how the problems that concern you might be solved by means of institutional reforms, see
http://www.amazon.com/Be-Solution-Entrepreneurs-Conscious-Capitalists/dp/0470450037
Be the Solution: How Entrepreneurs and Conscious Capitalists Can Solve All the Worlds Problems
www.amazon.com
Praise for Be the Solution 'In the past, many believed you either went into 'pu... See More 17 hours ago · Like · 1
Kevin D. Rollins Constitutions are institutional ideas held by the People. If the People fail, no constitution will prevent the victory of Tyranny. 17 hours ago · Like · 1
Chris Cook Michael Strong This is an interesting thread which is very relevant to my research at UCL's Institute for Security & Resilience Studies and my work generally. I think that we are moving away from institutions as Organisations - whether Public=State ...See More Resiliblog » Blog Archive » Nondominium: establishing consensus and collaboration for the Caspian blogs.ucl.ac.uk Wherever the writ of Western nations has run, so have attempts to impose the Rule of Law. But the Rule of Law has never sat well with other nations, particularly East of Suez, where absolute rights and obligations are not the norm, and where consensual agreements are customary. It is said that Napol... 9 hours ago · Like
Peter Burgess Michael Strong, Chris Cook, agree with respect to solving problems by fiddling with accounting standards. I see the need for vastly different progress and performance metrics inside the business organization ... and also in ALL places where there is economic activity, that is where there is use of resources to produce goods and services needed by people and society. In accountancy inside the business organization there is 'roll up' or consolidation so that the top entity can report its money profits to its investors and investor/executive level staff.There is no equivalent valuadd metric inside the organization nor are there any meaningful metrics that can be 'rolled up' from the economic activity up to the community. When a company fires a worker, wage costs go down and money profit goes up. With this transaction valuadd ... for the worker, for the family, for the community, for society goes down (with a mulitplier) but this does not feature in any easily accessible progress and performance accounting and reporting. A company closes down a plant ... moves out ... lower costs more profit. Community loses a payroll and is probably left with a blighted brownfield site and reduced tax base. Business never gets to be held accountable, but community pays a price. This goes way beyond anything that accountants can do with present money profit standards ... but, in my view, these valuadd metrics must be integrated into the main core of money profit accounting systems in order to be effective ... and in this regard there needs to be be 'buy-in' by the accounting / CFO community. 30 minutes ago · Like