In the Long Run…

An interesting article at the Mises site.  The article is by Murray Rothbard, entitled “Our Interests and Their Interests.”  The meaning of the title can be explained succinctly: whereas in a free market economy there is no clash of interests…

…the matter changes drastically, Mises points out, when we move to the intervention of government. For that very intervention necessarily creates conflict between those classes of people who are benefited or privileged by the State and those who are burdened by it.

Mises offered sound reason to demonstrate the fault in such thinking:

As Mises puts it,

In the short run an individual or a group may profit from violating the interests of other groups or individuals. But in the long run, in indulging in such actions, they damage their own selfish interests no less than those of the people they have injured.

Rothbard finds this approach lacking:

But Mises has a grave problem; as a utilitarian, indeed as someone who equates utilitarianism with economics and with the free market, he has to be able to convince everyone, even those whom he concedes are the ruling castes, that they would be better off in a free market and a free society, and that they too should agitate for this end.

The great problem here is: why should people always consult their long-run, as contrasted to their short-run, interests? Why is the long run the "right understanding"?

And I will take it from here.  I posted the following comment at the site:

[Rothbard]: “In brief, some moral doctrine beyond utilitarianism is necessary to assert that people should consult their long-run over their short-run interests.”

In succinct fashion, JM Keynes summed up the morality of this generation, the last century, and perhaps the time since the Enlightenment or earlier: “In the long run we are all dead.”  Without some thought to the consequence of life after death, why consider the long run?

[Rothbard]: “By amending Mises's theory to account for time preference and other problems in his "rightly understood" analysis, we conclude…that only moral principles beyond utilitarianism can ultimately settle the dispute between them.”

The west was, for more or less 1000 years, governed by such “moral principles” that considered the consequence of life after death. Perhaps without such moral principles, all that is left is the short run.

We need not debate theology, or entertain the nonsense that religion is incompatible with liberty; we are witness to the reality: when the “nobles” do not concern themselves with the long run, interests clash – and we are the losers.

I received several replies, some worth ignoring; one which said I had it backwards.  You can infer, from my further reply, the issue:

You misunderstand the point entirely. The topic isn't wealth accumulation - if this was the topic, there would be no reason to worry about the conflicting interests raised by Rothbard. The poorest person in the west today lives better than the kings of even a few centuries ago.

Interests were better aligned when the nobles felt troubled by eternal judgment. Interests were better aligned precisely because the nobles were concerned about the treasures they stored up in heaven.

Today's nobles don't worry at all about eternal judgment - they are acting in the ultimate short term, the span of their own lives. They care nothing of the wealth in the tradition and law of their predecessors, nor do they care of the legacy that they leave for their descendants.

Read Fritz Kern for an understanding of the medieval law; then perhaps Robert Latouche and Jean Gimpel about the advancements in technology. Then consider: we do not know if wealth accumulation might have been greater or lesser had the relatively libertarian law of the Middle Ages been allowed to develop.

But we can imagine that interests would have been better aligned.

This reply remained unsatisfactory to my interlocutor, but this is unimportant to me. 

So why do I bother sharing this with you?  The key point: Rothbard noted that “some moral doctrine beyond utilitarianism is necessary.”  There was a comment here recently (and not regarding this conversation at LvMI), suggesting that the moral doctrine Rothbard had as his foundation was the non-aggression principle, and that this singular foundation was sufficient. 

I have no idea if this is what Rothbard believed, but I know it is what many libertarians believe.  So I am clear: what follows is not aimed at Rothbard; it is aimed at the idea that the NAP is sufficient as a moral foundation for a society to conform, generally, to the NAP.

Libertarian Law

As I have noted many times, the European Middle Ages offered the best extended example of something approaching libertarian law and libertarian society.  I did not say perfectly libertarian law, but far more so than the law in our age.

Most importantly for the time: man did not create law.  Law was old and good; law was discovered, in the best sense of the word – discovered in the best of the old and good tradition.  All men were under the law – the king could not create law, his only duty was to enforce it.  Any noble could veto the king’s decision if it could be demonstrated that his decision violated the old and good law.

We could do worse…wait, we are doing worse.

There are some aspects of this medieval law that fall short of the NAP, for example: one was not free to destroy his property; usury was prohibited (albeit it wasn’t a complete ban on interest, and the meaning of the term “usury” evolved / varied); contracts deemed unfair to one party or the other were not enforceable – even if both parties initially agreed to the terms.

I know, I know – any libertarian worth his salt can poke a hole in these; I have done so myself in the past.  But still…something made the system work, made it reasonably libertarian (more so than the law in our age), and made it last.

My point?  It was something more than / other than the non-aggression principle that allowed the law to stay reasonably libertarian.

The Missing Link?

We all know the Golden Rule: Do to others what you want them to do to you.  Then there is the Silver Rule: One should not treat other people in the manner in which one would not want to be treated by them.

The Silver Rule is much closer to the non-aggression principle than is the Golden Rule; the Golden Rule is much closer to medieval law than is the Silver Rule.  Might this suggest that – at least given the historical precedent – it might take something more than the non-aggression principle in order to achieve a society that approaches the non-aggression principle?

This says nothing about the other conditions present during the period: Christian tradition, patriarchal, decentralized, competing governance institutions, etc.  I don’t discount the necessity of any of these.

Most important – and relevant to the subject of this post – the nobles of the time lived in a manner that considered the long run, the very long run.  They respected the traditions of their ancestors and were faithful stewards of the legacy that they would leave for their descendants.  Oh…they also considered their eternal soul.

They did to others as they wanted done to them; they respected their ancestors as they also wanted to be respected by their descendants.

Conclusion

As it relates to the context in which Keynes uttered these words, it was just as true for the nobles of medieval Europe as it is for today’s “nobles”: in the long run, we are all dead.  The difference is that the medieval nobles didn’t base their actions and laws on this concept; today’s “nobles” do. 

For this, we get “ours” and “theirs.”