Independence Day: Hayek explains Liberty

While America celebrates its day of Independence, people around the world are embracing the dangerous arms of government and giving up freedoms. Throughout history in times of economic upheaval, government has appeared to run to the rescue of economies in verge of collapse only to make matters worse. The Great Depression saw one of the largest expansion of the US Federal Government and yet despite the huge amount of dollars spent, the US fully recovered only after world war II. To add insult to injury, many do not seem to realize that it is government that heavily contributes to economic collapse. While the media rightly exposes on the disgraceful acts of Wall Street titans, it fails to expose the primary role of government in this collapse: the folly of the Federal reserve to inflate bubbles with low interest rates, the folly of the US Govt to inflate the housing markets through subsidized loans (Fannie Mae & Freedie Mac) and the failure of regulators in over a dozen agencies to properly expose abuse. Politicians tell us now that the failure of the market requires more restrictions of economic freedom and the creation of yet more regulators in Washington. Their solution is tie up small & mid-size businesses in regulations while unemployment explodes while bailing out their friends in large corporations despite these very subsidies have already led to collapse of historic firms such as GM & Chrysler, etc. Amidst this nonsense and the rush to curtail economic freedoms, it is valuable to re-evaluate the importance of liberty, the limits of government and power in the word of masters such F.A. Hayek.

Friedman’s warning for the time

At a time when people look to governments to solve all sorts problems, the cautionary words of Milton Friedman come to mind from this 1979 interview. Even when capitalism, which is no perfect system, seems to fails let’s not fool ourselves that men in politics can save the world. We shall never forget that government contributed to creating this crisis (through bubble inducing monetary policy) and fell to enforce even the regulation on books (Madoff anyone?). Freedom depends on free markets and free-thinking people.

Dangerous temptations in times of panic

In the annual report published by an American think-tank called Freedom House, freedom in 2008, for the third straight year, appears to be in retreat across the world. The report attempts to rate the freedom of each country according to several measures of political rights and civil liberties. The study finds that freedom was repressed in 34 countries with countries in sub-Saharan Africa seeing the most erosion. The number of electoral democracies fell by two to 119 but 2009 will be a difficult year as economic collapse could put young democracies under extra pressure. History shows that days of rising protectionism and nationalism are fertile times for authoritarian regimes to impose further restrictions on freedom. It would be a tragedy if today’s  economic collapse would allow governments to tempt voters to trade freedoms for the relative security that can be imposed at a great cost with more government controls and powers. Sadly however it would not be the first time and it is a very likely scenario in times of panic and uncertainty. Let us not forget the great cost at which today’s freedoms have been acquired.

Power, gulags and intellectuals’ curse

“The Gulag Archipelago”, Alexander Solzhenitsyn’s account of Stalin’s terror is one of the most powerful indictment of a political regime and helped to bring down the Soviet system that ruined millions of lives. His death on August 3rd however is a reminder of how rare his courage remains. Dissidents are always a tiny minority of the official intelligentsia because often, especially in Soviet times, telling the truth requires great courage and brings fearful consequences. Unfortunately today many of Russia’s contemporary intellectuals, instead of defending the freedoms acquired after the end of communism, have connived in Putin’s project of strangling democracy for the sake of nationalism or for that perks their silence brings. As a result it is not surprising that a resurgent Russia invaded Georgia last month and is threatening other independent states of Eastern Europe as it slides unchallenged toward more authoritarianism. In China the intellectuals’ silence is easier to forgive because dissent is still sharply controlled and the Tiannamen crackdown in 1989 banished free thinking. The emergence of the internet and a publishing industry however has changed China less than it should have and with the economy flourishing for a lot of people and intellectuals life is good.

Western intellectuals who often enjoy a pampered existence as tenured academics often delight in savaging the very capitalism that affords them this luxury. More importantly Western intellectuals often complain about the demise of the intellectual as the cacophony of ideas produced by democracies drowns out their voices. In reality the challenge of democracy is not cacophony because ideas should not be suppressed but nor should they be worshiped. In 1848 two intellectuals published another powerful indictment of a system, and their “Communist Manifesto” went on to enslave half of mankind. The lessons of history shows that one of the best defense against bad ideas is an educated and skeptical people that are free to listen to ideas but not in thrall to them. Solzhenitsyn hated this lack of deference and the materialism in the West but like Sakharov’s, his some of his thoughts shall be treasured. Though the Nazis had unleashed atrocities on Russia, Solzhenitsyn serving in the Soviet army wrote “I remember myself in my captain’s shoulder-straps and the forward march of my battery through East Prussia, enshrouded in fire, and I say: ‘So were we any better?’” In one poem, “Prussian Nights”, he wrote:

The little daughter’s on the mattress,
Dead. How many have been on it
A platoon, a company perhaps?
A girl’s been turned into a woman,
A woman turned into a corpse

Censoring Free Speech Online

In a post-industrial era where information and the exchange of ideas are as critical to the wealth of nations as much as capital, it is very alarming to see that censorship still prevails in certain parts of the world. In some cases restricting online content to filter, for example as done in many western countries, obscene and violent material especially against children may seem tolerable. However the pervasive censorship performed in some parts of Africa and Asia, especially the Middle East and China is very dangerous. Why should we care if we are not affected by it? Well, censoring free speech online and off is a threat to world peace and prosperity that should concerns us all. By blocking the exchange of information fearful tyrants bend the truth and foment hate and lies that generate extremism and can degenerate into armed conflict. I know these days it is fashionable to be green but next time we worry about saving the planet, spare a thought for our fellow men and women who leave behind these virtual walls and support organizations like Radio Free Asia who try to combat this nonsense.

Privacy: Risking Extinction

 

Privacy, it seems, is a luxury that we can no longer afford in a world where terror and extremism are on the rise. At least that is what governments claim as they seek free license to spy on our lives. Although different countries impose different level of intrusion (see chart), clearly privacy in under threat everywhere. Technology has also made their task easier with the invasion of cameras, wiretapping tools and satellites that are taking snapshots of our lives continuously. Surveys show that people in general are willing to trade some privacy for security but while the world is increasingly a less private place, there is no  evidence that paying such a high price is making our lives any safer. Privacy is a vital freedom under threat and in order to safeguard it  from extinction we would do well to embrace Jefferson’s insight as it called eternal vigilance the price of liberty.

Freedom in Retreat

According to the annual report of the Freedom House the state of liberty is in serious deterioration with reversals seen in 38 countries nearly four times as many as are showing any sign of improvement. The world is still enjoying gains from the fall of communism, at least in central Europe, and the decline of militarism in Latin America. But the short-term trends seem worrying with an increasing number of countries in all regions of the world where a previously hopeful trend has gone into reverse (Bangladesh, Sri Lanka Philippines, Nigeria, Kenya, etc). This is not good news given freedom is a key  antidote to war and poverty. For all the proclaimed intelligence, we humans have a real gift at excel at complicating our existence.