How can libertarians be so cynical about government yet so naive about the free market?

[I love everyone]

Libertarians will hardly acknowledge the possibility that government can do things which are beneficial to society, even when they look at positive outcomes from things like social security they will turn around and argue that it's actually a negative outcome in disguise. Yet when it comes to the free market they have unshakable faith in it, like they just trust that everyone who is pursuing profit will automatically do what is best for society, because it's bad PR to do otherwise. They seem to be unaware of the possibility that the pursuit of profit and what is best for society often creates a conflict of interest.
I don't automatically trust government. I look at things like social security and think "ok that works" and I look at things like the patriot act and think "ok that doesn't work". Quality of government over quantity of government.
SS is so easy to fix!! Get rid of the $100,000 cap on SS taxable income. Problem solved. Right now it is funded by an obscenely regressive tax system, it's funded entirely by the working class.

[I got Mail! YAY!]

Fantastic question. Star for you.

I think the libertarian position on this is so bizarre it confuses them too, which is why they can't explain it effectively to anyone else.

[590]

How can liberals be so cynical about the free market and so naive about government. After all, government has such a wonderful track record of delivering efficient results.

[613]

Libertarians are consistent. They don't want to be controlled by the government in any way -- that includes it's meddling in the free market.

[serf]

I acknowledge that the government can do things which are beneficial to society.
Therefore, you have no idea what you're talking about.
QED.


P.S. Social security is broken.

[Infernal Disaster]

The money you want to rape from society was obtained from a market economy.

Which brings us to the problem with Socialist like yourself, you're eager to spend/squander other people's money, yet the system you promote has no way to replace that money.

Socialism works until the money runs out.

Social Security works?

Only a socialist-liberal can be foolish enough to call a program that is on the verge of collapse and kept afloat by borrowing from China and Japan, a success.

[NYCsker]

Libertarians, at least the modern ones, don't believe in uninhibited pursuit of profit. They just want any regulation to be reasonable, and take into account a person's (or company's) property rights. A socialist model, by contrast, believes that you have no right to your property, that everything you own is owned by everyone else...and if you really consider it, that's more anarchic and insane than even the most extreme libertarian. Why? Because it punishes you for working hard enough to own something, and rewards others by using YOUR property/wealth/etc for them.

I know this is a long route to answer your question, but I guess I would just say moderate libertarians do not "trust that everyone who is pursuing profit will automatically do what is best for society..."

As far as the social security comment, I'd suggest it's not that beneficial...in fact right now it's a complete disaster. All the money you are putting into it right now, you will never see. The system is already bankrupt. There COULD have been a better system in place, but we have, well, social security.

[me]

its not "people wanting profits" that controls the free market, profits are just an outcome. its the natural balance that supply and demand seeks that controls the free market. and its not a "belief", like a religion, its simple economics. and social security is a good thing??? what libertarians do "believe" is that you cannot take something by force from one individual and give it to another individual who had no claim on it. that is theft, and that is what SS is. never mind the fact that it is broke and has always been a ponzi scheme for the gov.

[Joe S]

You ask a great question that could be generalized to address *any* ideology. People tend to see the worst in what they have decided to oppose and can see no wrong in their chosen ideological institution. I know that I have been guilty of this though I am trying to reform.

Of course, we should acknowledge that not all libertarians are so naive just as not everyone who generally supports government is so naive as to think that everything government does is good [your opposition to the Patriot Act being an excellent illustration]. That being out of the way, when it comes to ideology, it is hard for people to be even and objective. I think that libertarian ideology is based upon sound principles and has much to offer. But once you arrive at its initial conclusions, it is hard to continue to broaden your scope.

Personally, while I am libertarian to the extreme, I have tried hard to stop differentiating between people in government and other people. People are people, and so I have tried to make my political studies a study in human action generally. Focusing my thought in this manner leads me to conclude that some people will try to gain unfair advantage using whatever institutions that they find in place. To be sure, a powerful central government is a tempting target for people wanting to find such advantages. But in the complete absence of a central government, those same people might search for other ways to fleece to public. The debate between libertarians and statists ought to be whether their opportunity, absent a strong central regulator, would be greater or less. Abandoning naivety should convince both sides that scoundrels will be scoundrels no matter what institutions that we form.

A common argument that I raise is that opposing the government provision of something is not to oppose its provision generally. For instance, there is the potential for private, de-centralized regulation. People could set themselves as watch dog groups and subsist either through donation or by establishing business models that allow them to charge fees. Of course, there is a risk that regulation won’t be done well or at all if left to private, voluntary market action. But we have seen well (with the repeal of Glass Steagall, for instance) that the same risk exists when regulation is left to a central agency. What’s more, I believe that the potential for moral hazard is greater with a greater concentration of control.

You mention Social Security. To be sure, a compulsory pension is not the top of my list if I am targeting government programs to oppose. Many people arguing against Social Security do not have a full basis on which to establish their arguments. As an actuary who understands pension mechanisms, I can say that Social Security is criminally under funded (as in, a private pension so funded would have serious legal attention directed toward them). Yet the charge of pyramid scheme fails to account for the similar working of private pension plans.

In Social Security, it is its compulsory nature that bothers me (just as I generally am leery of *any* compulsory program). While it may not be denied that Social Security has helped a great many people, we should be aware of the drains on tax systems that arise when tax proceeds can be directed toward lobby influenced spending. We should also open our imagination to how society could evolve if left up to more voluntary institutions. For instance, Social Security strongly encourages the work-until-retirement-age mentality. Might other arrangements lead to a different work-life balance? Perhaps, instead of working for 40 or more years, we might see people moving in and out of retirement. Work for ten years. Stop working for five and then enter the work force again when you need money again. In theory, you could do that today, but the tax system and general culture (partially driven by government programs) works against you.

In conclusion, you are right to charge libertarians with being naïve. I hope that you recognize the merits of libertarian ideas and can excuse the libertarian faithful for evaluating those ideals too narrowly. Indeed, while I tried to open up my answer with balance, I’m afraid that I ended up with a diatribe against government. I assure you that I do recognize the potential for abuse no matter what systems we enact. Indeed, if government could be eliminated (not that all libertarians want this extreme), we would invite disaster if we did not first develop institutions to replace some of its functions.

[oohhbother]

They lack a grounding in the history of this country and the relationships between the public, business, and government that have grown up to cause the regulation of business.

Unregulated capitalism is ironically the main cause of communism through abuse of the public and the concentration of wealth.