The restrictions imposed due to the pandemic brought out some strong libertarian sentiments among, mostly, conservative Americans. Statements like “It is my right to …. “ were heard a lot more often than before. Individualism is an important component of libertarianism and we can suppose many of those who saw it to be their right to act as they preferred during the pandemic might have found an ideological cover under the banner of libertarianism.
Relatively recent polls show that libertarians may comprise between 10 and 20 percent of the American population. The range is so wide because the public has a rather vague idea of what to be a libertarian means. A 2014 Pew survey revealed that about a quarter of those identifying as libertarians had no idea what it means. The result is a selective libertarian behavior.
In the website of the libertarian Cato Institute, libertarianism stands for: individualism, individual rights, limited government, free markets and peace. The organizing principle of libertarianism is that individuals acting out of their personal interests find a way to arrive at outcomes that are also good for the whole. This would be a compelling recipe for social organization if it accorded with human nature and experience. But it’s not, and that’s why libertarianism has been met with heavy criticism and little acceptance.
The libertarian movement, especially in its mistrust of authority, has, nonetheless, a noble history. It came out of John Locke’s critic of the absolute authority of monarchs and Adam Smith’s ideas that the production and exchange of goods could be accomplished through the mechanism of markets without planning by a central governmental authority. Others see in libertarianism the same unplanned (no designing authority) evolutionary process we see in the natural world, which would explain the libertarians’ sense that government interference is unnecessary if not harmful (see, for example, Matt Ridley’s Evolution of Everything).
Pitting, however, the individual against organized authority misses the point that in its most basic functions, individual behavior is shaped and bounded by social forces. That is, it is not the individual versus the authority, but rather the individual in relation to its social environment that matters. Today we know that humans obtain many of the features that distinguish us from other species not by living in isolation but within social settings that help us survive, learn, and grow. Humans survive thanks to innate altruism and cooperation. Part of our social living is to limit the boundaries of our individual freedoms in the interest of the survival and prosperity of our social group.
Adam Smith foresaw some of these modern insights when he proposed that individual behavior should be moderated by mutual sympathy and that people would be pleased to contribute to the happiness of others. His market economy implied cooperation and working for each other rather than individuals acting as they please.
The belief that individual autonomy can produce benevolent outcomes for all ignores the fact that very often individual and collective interests diverge. It also ignores that individual actions can produce negative externalities, to use an economic term, that is, harmful consequences on others as well as on the social group. To go, for example, around without a mask seems to be your right until you are reminded that you may infect somebody else or generate stress in others. Now think of the consequences of a mask-less behavior. Cautious people avoid venues frequented by mask-less people. Social contacts diminish and ill will rises. The result is gradual social disintegration. Unless you value your right not to wear a mask more than the well-being of your social setting, why do it?
Next consider the libertarian adherence in unfettered capitalism and its corollaries: that markets do not fail and winners and losers are determined by individual effort and merit alone. We know that both are wrong. Markets can fail for various reasons, one of them being the presence of asymmetric information between market participants. How, in the absence of laws, do you get ex ante protection against, say, the sale of dubious financial products or drugs? The promise of long-term gain from maintaining a good reputation is often tramped by the allure of a quick profit. In a recent New York Times article, Robert Frank (a retired professor from Cornell University) reminds us of another example of market failure. To lower the risk of car injuries some consumers switch to larger cars, say, SUVs. For a while they enjoy a lower risk advantage. But then many more consumers switch to SUVs, thus restoring the previous level of risk. While that risk remains the same, there are negative consequences on the climate, road maintenance and so on. Clearly, individual-centric behavior has generated net costs for everybody.
Behavioral economics also suggests that many economic decisions are the product of cognitive biases than the virtue of rationality and it’s best for individuals to be nudged to act optimally. For example, presented with both choices to opt-in or opt-out, many young people refuse to participate in retirement savings programs to their loss. Making opt-in the default choice for all employees would better serve their interests.
Nor is the role of government redundant in the modern economy. Since the days of John Locke and Adam Smith, the world has become extremely more complex in terms of information, technology, institutions, and possibilities. The issue is not whether government is big or small but rather whether it can efficiently or not empower individuals to navigate complex environments.
For all these shortcomings, it is not surprising that libertarianism has failed to be the organizing principle of old or modern societies and states. From the time of hunter-gatherers, to the farming economies and first cities, and later through the three modern industrial revolutions, people have organized themselves through a complex nexus of informal and formal relationships and rules that have harnessed excesses of individual freedoms and rights in order to serve the collective good.
In the end, libertarianism is an aspirational ideology but unfortunately out of touch with what makes humans humane and societies better.
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