Usually, I dislike knee-jerk liberal demonization of libertarians. On stereotypical areas of liberal-libertarian convergence, many libertarian writers do great work. Such issues are sometimes labeled social issues, but that gives an overly-narrow impression of the range of issues we’re talking about here. On issues ranging from war to civil liberties to criminal justice to sex and drugs to immigration, I find a lot to like in libertarianism.
I even agree that the benefits of free markets are widely under-appreciated, and that much existing government regulation is harmful. But while markets may be more powerful than most people realize, they’re not as magical as they’re made out to be in Atlas Shrugged. Externalities, for example, are a thing, and the fact that there are some bad regulations is no reason to get rid of the environmental regulations that stop the air in major US cities from being like that of Beijing. And it’s hard to see anything wrong with taxing the wealthy and forcing them to live in slightly less luxury in order to pay for things like food and health care for the poor.
But the disagreements in the previous paragraph aren’t what this post is about. What prompted this post was an article I stumbled across by libertarian tech billionaire Peter Thiel, where he explains why “I no longer believe that freedom and democracy are compatible.” This paragraph in particular stood out (emphasis mine):
Indeed, even more pessimistically, the trend has been going the wrong way for a long time. To return to finance, the last economic depression in the United States that did not result in massive government intervention was the collapse of 1920–21. It was sharp but short, and entailed the sort of Schumpeterian “creative destruction” that could lead to a real boom. The decade that followed — the roaring 1920s — was so strong that historians have forgotten the depression that started it. The 1920s were the last decade in American history during which one could be genuinely optimistic about politics. Since 1920, the vast increase in welfare beneficiaries and the extension of the franchise to women — two constituencies that are notoriously tough for libertarians — have rendered the notion of “capitalist democracy” into an oxymoron.
I also wonder if Thiel’s anti-democratic sentiments are going to be a growing trend among geeky libertarian types. On issues like drug legalization, current policy may suck but we can at least see things slowly moving in the right direction. But there’s not the slightest sign of the public coming around to the dogmatic libertarian view of, say environmental regulations or healthcare. This has got to put a strain on libertarian commitment to democracy.
This seems to be a significant part of the drive behind neoreactionaries of the Moldbuggian variety: if we can’t get the public to support doctrinaire libertarian policies, maybe we can install a libertarian Czar. The neoreactionaries are still pretty fringe right now, even in online communities with a strong libertarian presence, but I wonder if we’ll see more libertarians shifting in that direction.