By Brian Doherty
In a contribution to the larger "liberaltarian" debate, monetary economist Scott Sumner, who describes himself as a "pragmatic libertarian," offers an encouraging list of the sorts of things most standard American liberals used to believe, but don't any longer:
Let’s review what liberals used to believe, before libertarians knocked some sense into them:
1. In the US, they believed the prices of goods and services should be set by the government. Ditto for wages. This took the form of the NIRA in the 1930s. It took the form of multiple industry regulatory agencies like the ICC and CAB. By the late 1960s and early 1970s they favored “incomes policies” which were essentially across the board wage and price controls. Today they generally favor letting the market set wages and prices. Very liberal Massachusetts recently abolished all rent controls.
2. In the US, they believed the government should control entry to new industries. They have abandoned that belief in many industries, and based on recent posts by people like Matt Yglesias, are becoming increasingly disillusioned with remaining occupational restrictions.
3. They favored 90% tax rates on the rich. Today they favor rates closer to 50% on the rich.
4. In most countries liberals thought government should own large corporations. Today most liberals around the world think large enterprises should be privatized. Over the next few decades there will be trillions of dollars in new privatizations, and very few nationalizations.
I used to say and write similar things when contemplating the victories of the libertarian movement, around when my book Radicals for Capitalism: A Freewheeling History of the Modern American Libertarian Movement, came out. The bailouts and the industry takeovers post-crisis made me a little less sure that certain of these victories were secure, and I'm still a little less optimistic than Summers is that those bad ideas are dead. Still, encouraging to contemplate.
Sumner was part of our October 2009 roundtable on inflation.