Questions raised by long-term liberalisation

Generally libertarians I think belive that governments only grow. That if left unchecked the long term trend will always be towards less freedom. But how can the cases where that was decidedly not the case explained? Take the post-war Soviet Union where the trend was towards liberalisation. The same for example in China after Mao where it is stil going on.

Are USSR and PRC actually arguments for the possibility of a limited government? (Just not as limited as the Liberals would have it.) Is there a level of illiberalism that a state will not in the long term tend to surpass, but will tend to climb down from? And if so, why?

Robert Higgs describes the “ratchet effect”, which suggests that even if there are temporary liberalizations, the long-run trend tends to push further towards larger government. I cannot say this applies to all countries, but it certainly does to Spain. During the 1960s Spain went through a dramatic liberalization (at least, economically), only to see much of these liberalizations slowly rescinded by the democratic government that succeeded Francisco Franco. Spain today is, in some areas, less free than it was during the tyranny of Franco’s fascist regime. But, Spain’s liberalization did not come because the government wanted to liberalize the economy; Spain was on the brink of famine, and so it made sense that Franco finally decided to liberalize or face growing unrest. I think many other countries suffered from similar moments of “being on the edge”. In many cases, it should also be considered that many (even most; at least during the late 20th century) “liberalizations” have proven to be phony.

But it was the case. The state only grew, until it failed and collapsed. The parasites could no longer be sustained. De-socialization occurred but it was hardly Libertarian and just. Most property moved to private hands, i.e into the hands of the apparatchiks.

And thus the process began again. New state, it’s growth and reach continue again.

Lesson not learned.

No.

Why state as fact things you actually do not know? The state was not growing. The state was shrinking. The USSR was becoming freer since the end of WWII.

And no, the oligarch class is not made up of former apparatchiks. Wrong again.

I don’t know. In the 80s and 90s, marketization and privatization were widespread and popular, but those trends seem to be reversing. I think what happened in that time was the exception, not the rule.

Hmm?

“That if left unchecked the long term trend will always be towards less freedom.” ← That is the case when a state exists, it doesn’t change.

“But how can the cases where that was decidedly not the case explained?” ← What would be an example of a long term trend of government being for more freedom?

And thus the process began again. New state, it’s growth and reach continue again.

Lesson not learned.

Russia’s March From Communism - Hans F. Sennholz

"The Russian transition from a harsh command system to an individual enterprise order undoubtedly was arduous and painful for millions of individuals accustomed to the old ways. It introduced an order they did not understand. But many intelligent individuals in positions of State and Party leadership viewed the transition as personal opportunity and chance from which to profit.

Experienced in the old ways of “wheeling and dealing” in political relations, they managed to acquire large enterprises by questionable means. They had political influence but little or no economic know-how and no interest in competing in markets and serving customers. They became the oligarchs, a small faction of politically connected individuals who held sway over the Russian economy."

A key question for future economic conditions in Russia–as it is for all countries–will be how the government chooses to treat successful businessmen and business associations. Most politicians and government officials sincerely distrust business success; nothing sharpens their sight like envy. Moreover, in a transition economy such as the Russian, it is rather difficult to distinguish between various types of nouveaux riches. There are some successful entrepreneurs who honestly and capably serve their customers, painstakingly observing every rule and regulation.

There also are numerous entrepreneurs who honestly serve their customers but conveniently violate some harmful law or regulation. And, finally, there are the oligarchs who acquired their wealth through politics which, in such situations, busily turns public property into private wealth. The economic future of Russia obviously hinges on the ways in which the politicians in power will treat the entrepreneurs and their wealth.

Oil booms, but investors flee Russia - http://blog.mises.org/archives/003458.asp

Old habits die hard.

These should be the best of times for oil-rich Russia, with prices remaining above $50 per barrel. Instead, foreign investors are fleeing, and with them skills, technology, and capital. Amazing how that happens when the state seizes private property and puts businessmen in jail for supposed tax-evasion. Net capital outflow has quadrupled, from $2b to $9b, in one year.

But it’s not just Yukos. Many other companies have been harassed as well.

Putin is promising changes for the better, but given his track record, he lacks credibility. As one businessman notes:

“The harm was done. Also, the hunting dogs of law enforcement and tax collection are out. Once they’ve tasted blood, it’s very hard to get them back on the leash.”’

I have specifically said the examples are 1945-1991 USSR and 1979-2009 PRC. If you do not see movement towards more freedom in these two cases I can only assume it is because you are being intellectualy dishonest.

Mr. Hans F. Sennholz does not have anything to teach me on the subject. Tha oligarch class stemms from Gorbachev`s era black marketeers and entrepreneurs who made considerable wealth on the market (often in ways that were against the spirit or the letter of the law, but to which an anti-statist could not object to) before the privatisation, to then use their new-found wealth and newly found political connections to loot the state owned industries. It was the former aparatchiki who enabled them to do this, but it was not the aparatchiki themselves who were the main beneficiaries of the privatisation. It is an important point to make only because it reveals your ignorance of the subject and therefore questions the validity of you holding an opinion on it.

Where exactly did you do that? You did not specify at all. What you are doing now is clarifying. It certainly wasn’t clear to me that was the only era you wanted a response on. I took “Take the post-war Soviet Union where the trend was towards liberalisation.” As one possible example.

Oh ok, so I and Sennholz have revealed our ignorance, how quaint.

Well there was an episode in Soviet history of a reverse ratchet effect. During The Great Patriotic War the persecution of the Russian Orthodox Church ceased. It would return later on, but never again reaching the intensity of the pre war repression, making for a positive change in the long term.

I suspect the liberalisation must come where the regime, the brain of the state comes to the realisation that further growth would actually impede its power rather than enhance it. Either because it realises the terror is threatening to kill its host. Or because it sees partial liberalisation as a way to aid its competition against another state. Or because it fears internal unrest and seeks to appease the people lest they threaten to topple it.

The first two reasons are very mechanical and I think in the long term provide the upper limit on how much a state can grow regardless of all other factors. It is simply impossible for a state to defy reality such as the laws of economics.

But the third reason is where the role of ideas comes in which have the power to lower this physical ceiling. While earlier on liberalisation came in order to in the long term aid the state, Gorbachev on the other hand was forced to reform by the dicontent and disillusionment of the populace. A populace which was the most dicontent jet, despite being - not more but - less shackled than in earlier decades.

You are looking at too small a scale. You might find a 50 year time-span where some more freedom was created, but the argument is that in the end, all those freedoms will be taken again. As long as a state exists, you might have short time spans of liberalization, but over a longer span of time you have an expansion of the state.

So if I took a longer time scale and dicover nothing but growth of the state, would not one expect that by now there would be tons of really huge states? If the state does nothing but grown where are all the trully large, totalitarian states? How many exist this moment? One? If the state only grows then how come hardline totalitarianism is the exception, not the rule?

No I do not belive that every freedom achieved must necessarily be later on surrendered. I do not belive USSR successor states inevitably have to return to where they were before the post-war liberalisation and stay there.

Your thinking laterally. You need to think in 3d not in 2d. States don’t grow laterally any more. They grow in dept and height. This is akin to a city that has run out of real-estate. Instead of growing north, south, east, west it grows up and down. The state, likewise, grows larger not geographically speaking but in economic size. The state consumes a percentage of a nations product. It doesn’t need to grow geographically any more. It only needs a larger hold on your pocket book.

Geographically? I am most definetely not talking about geographic growth. Obviously a totalitarian state consumes the largest percentage of the nation`s product and is the deepest and heighest and widest and longest and what not.

I guess I got confused in your posts. Re-reading your original post I was thinking Orwellian super state. Though I already consider most 1st world country’s to be ridiculously huge as is and quiet frankly am surprised your contesting the point, but to continue onto your original post.

The answer is obviously yes.

At some point in time the state will no longer be able to grow without drastically damaging it’s economic state. Therebye causing itself to loose power and shrink. I suppose the state must find that sweet spot to surf where the economy can still somewhat thrive, enough for it to leeche off of it but not turn it into a downward trend.

I do believe there is a point where the state will become so large that it will loose a grip on the resources it needs enforce itself appropriately.