Neoliberals Used to Refer to Themselves as New Democrats

Jonathan Chait is mad that people call him a “neoliberal” and so insists that the word has no meaning and that it does not describe a real political change that occurred a few decades ago. Many have already explained how silly this feint is, but I would like to add two other points.

First, potent words get stretched in popular discourse to the point of incoherence and contradiction all the time. It is one of the great paradoxes of language that words that pique people eventually get annihilated into meaninglessness through overuse. There is nothing special about “neoliberalism” in this regard. The same could be said of words like “intersectionality,” “structural,” “patriarchy,” and dozens of similar words that had fairly clear meanings at one point but that you can also find people using in a lot of different and conflicting ways in the discourse.

Second, if we can put aside the word “neoliberal” for a second, Chait’s main claim here is that nothing changed about the Democratic party and that leftists are lying or delusional when they say it did. What’s weird about this move is that Democrats themselves claimed at the time that they were changing. They even called themselves “New Democrats,” you know like “Neodemocrats,” or maybe even “neoliberals.” Perhaps the self-proclaimed New Democrats, which included Bill Clinton and Al Gore, among others, were lying about changing, but we should at least take seriously the proposition that they were sincere and actually intended, as they claimed, to shift the party towards the center and away from the left.

The Democratic Leadership Council, which Bill Clinton was president of prior to his run for the White House, certainly spoke a big game about how they were different from old Democrats. In their 1991 document titled “The New American Choice Resolutions” (there is that pesky word again!), they had this to say:

The old ideologies on the right and left are no longer sufficient to realize the aspirations of the American people, and both political parties will be left behind unless they put forth new answers and new institutions for a new era.

But in the minds of too many Americans, the Democratic Party has stood for government programs that don’t work, special interests before the interests of ordinary people, and a reluctance to assert American values at home and abroad. The New Deal policies that built and united the middle class no longer command its loyalty.

Our party’s challenge today is to discard the orthodoxies of the past and make government a champion of national purpose and not a captive of narrow interests, a creator of opportunity and not an obstacle to it. Democrats should once again stand for change and innovation, not blind loyalty to programs of the past. Unlike the Republicans, we believe in government and want to make it work in the information age.

The new choice we offer is a new public philosophy, not a new set of programs.

What does this New Democratic Philosophy consist of?

We believe the mission of government is to expand opportunity, not bureaucracy.

We believe the role of government is to guarantee equal opportunity, not mandate equal outcomes.

We believe our society has a moral duty to experiment with fundamentally new approaches to liberate the poor from poverty and dependence by promoting work, family, and independence. America will not succeed in the information age if we continue to waste the potential of millions of disadvantaged citizens.

We believe in reinventing government. We want to eliminate unneeded layers of bureaucracy, and give citizens more choice in public services, from child care and care for the elderly to public schools.

And they just keep on going, finishing with a wonderful flourish.

Our goal is to make the beliefs, ideas, and governing approach of the new choice the dominant political thinking in America before this decade is out. Just as the New Deal shaped the political order for the industrial age, the new choice can define politics in the information age.

Our purpose is not to seek the middle of the road but to build a new road that leads beyond right and left to move America forward.

The industrial age is over; the old isms and the old ways don’t work anymore. Today, and in the months to come, we will put forth new answers and a new way of thinking which are based on the principle of inclusion and work for the greatest public good. We invite the American people to join our cause.

The idea that the New Democrats (don’t call them neoliberals!) represented a break from the Democrats of old that turned against the interests of their base is not a particularly radical one. In fact, a gentleman by the name of Jonathan Chait said as much just four days ago:

That is not the approach Democrats have taken in office. Bill Clinton famously fashioned himself as a “New Democrat,” angering his base on crime and welfare and declaring the era of big government over.

Imagine that.

Land as soil and land as space

The argument that people can appropriate unowned land by mixing their labor with it has a lot of problems. Labor is not a substance, and so it cannot be mixed. Even if it could be mixed, it is not clear why mixing it with something transforms the unowned particles into owned particles. Even if you can get past the weird mechanics of mixing, such appropriation would seem to violate ordinary libertarian ethics of non-aggression because everyone except the appropriator has their previously-existing access to the land violently taken from them without their consent.

These are all problems that have been discussed extensively and advocates of the theory lack a convincing retort. But there is another fundamental problem that I have not seen discussed before. And that problem is this: “land” ambiguously refers both to “soil” and to “space” and the mistaken conflation of the two is what really drives the entire labor-mixing theory.

When you ask someone what they mean when they say that someone has “mixed their labor” with a piece of land, they usually reach for an agricultural example: a person mixes their labor with the land by cultivating the soil and planting crops. Insofar as agriculture was the overwhelming purpose of land at the origin of this theory, this makes sense. But the example does not explain how space comes to be own.

If someone cultivates the soil, then the labor-mixing theory should say that they own the soil, not the space the soil sits in. The space the soil sits in, which can be described by reference to lines of longitude and latitude or by drawing lines on a map, is not mixable. It’s a container. It’s territory. It’s not soil.

The difference between “soil” and “space” is very easy to see once you recognize that soil can be moved to a different space. The layer of topsoil a person has mixed their labor with could be shoveled into a truck and moved elsewhere. Once that soil is moved, nothing is left in the space that the person has mixed their labor with.

The same is true of any other labor mixed in any other space. A house built on some piece of land could be loaded onto a special truck and moved. I’ve seen them do it on TV. So could any other structure. For any given land claim, the objects that the labor was mixed with could be isolated and moved outside of the space.

So how does someone ever come to own the space itself rather than just the objects that were sitting in the space when labor was mixed with them? This is not a trivial question because it is in fact the space that is so valuable. That’s what land rents (these days especially) are being paid to: not to soil but to space.

As far as I can tell, the labor-mixing theory has no actual argument for how space can be owned, but has instead equivocated between different uses of the word “land” to move deceptively from “soil can be owned” to “space can be owned” without providing a separate argument for the latter.

If fireproofing is a waste for the poor, it is also a waste for the rich

Megan McArdle has this piece about the London fire in which she argues that it could be that installing sprinklers and other fireproofing will actually kill more people than it saves:

If it costs more to build buildings, then rents will rise. People will be forced to live in smaller spaces, perhaps farther away. Some of them, in fact, may be forced to commute by automobile, and then die in a car accident. We don’t see those costs in the same way as we see a fire’s victims; we will never know the name of the guy who was killed in a car accident because he had to live far from work because rents rose because regulators required sprinkler systems. But that is a distinction for public opinion, not for good policy making. Good regulations would take into account the proximate and distant effects.

She is careful to say she has no idea if this is actually true in this scenario, but nonetheless feels like we need to consider this possibility.

So let us actually consider this possibility and tease out its full implications, not only as it pertains to the housing of the poor, but also as it pertains to the housing of the rich.

McArdle argues that fireproofing will increase unit building costs and the negative effect this has is that people have to live farther away and commute for longer periods of time. But if this is true, then it is true of fireproofing in general. The Kensington mansions that have substantial fireproofing also have the exact same detrimental effect on rents. And so if it can be determined that those effects are so negative that fireproofing is net harmful, then fireproofing should be banned. Allowing an owner of a Kensington mansion to fireproof their home is to allow the owner to literally kill other people.

Indeed, if you are worried about the higher rents caused by fireproofing, you should also be worried about the higher rents caused by high-end amenities in general. Ban granite countertops. Ban exposed brick. Ban everything else that about a housing unit that gets rich people excited enough to pay higher rents. You can live with a laminate countertop. Others literally will not live if you install a granite one.

McArdle then goes on to argue that, separate from the issue of rents, the resources that go into fireproofing could be dedicated towards other things. But once again, this argument is equally applicable to the fireproofing carried out by rich people. If it is a waste to use some of the country’s scarce work hours and scarce raw materials to put a sprinkler system into a public housing complex, then it is just as much of a waste to use those same hours and materials to put the system into a private housing complex. The wastefulness of a particular unit of production does not change just because the income of its consumer is higher.

As David Lammy noted: “If you want to build these buildings, then let them at least be as good as the luxury penthouses that are also being built.” The equivalence between the two with respect to fireproofing is key here. If you think the fireproofing is worth it, then it should be available across the board. If not, then it should be unavailable across the board. This is especially true if you believe, as McArdle does, that the installation of fireproofing has negative externalities because of its effects on rents. It is (arguably) one thing to hurt yourself by wastefully fireproofing; it is another to kill other people by doing so.

Despite the fact that her argument clearly points in the direction of a universal rule on fireproofing (whether yay or nay), that is unsurprisingly not where McArdle ultimately winds up.

People can make their own assessments of the risks, and the price they’re willing to pay to allay them, rather than substituting the judgment of some politician or bureaucrat who will not receive the benefit or pay the cost.

After just saying that unnecessary fireproofing will kill other human beings, McArdle bizarrely reaches the conclusion that individuals should be able to decide on their own whether to do it (i.e. whether to kill other human beings). Even though there is nothing in her argument that supports the idea that fireproofing might be a wise way to allocate resources for the dwellings of the rich but not a wise way to allocate them for the dwellings of the poor, the upshot of her ultimate policy preference is precisely that: the rich will generally be safe from fire, but the poor will not.