Economy

The Economic Apocalypse Isn’t So Bad

February 11, 2009

Multiple Pages
The Economic Apocalypse Isn’t So Bad

So cheer up!

Austin’s essay on the distinction between “tragic” and “comic” libertarianism was sparked, I gather, from some email conversations between the two of us in which I’ve been waxing tragic (if not always displaying my devotion to liberty.) I remember nudging Austin to invest in some gold bullion in order to protect his family’s wealth from Ben Bernanke’s money printing and the massive destruction of asset value that us “tragics” see as imminent. Austin countered that while gold might hold its value, he remains a believer in modern portfolio theory (that is, broad diversification and index funds) because he thinks that over the next 40 years, there’ll be major technological and entrepreneurial breakthroughs and widespread wealth creation. Sooner or later, he says, we’ll have a repeat of the second half of the 20th century.

Perhaps. But my response, in turn, was that if in the spring of 1914, a British pundit publicly opined that in 40 years the Pound Sterling would be devalued and lose its worldwide “reserve currency” status, that the Empire would dissolve, and that the United Kingdom as a whole would be significantly poorer, onlookers would probably dismiss him as a crank, or perhaps even question his sanity. And yet, all these things would come to pass. 

If “tragic libertarianism” means an undeceived grasp of the harmful effects of the expansion of the welfare/warfare state and the degeneration of the human capital of our nation, as well as the natural rise and fall of empires and great powers, then it’s most definitely a useful and necessary corrective to groundless “American optimism” (whether of the Reaganite or Obamian variety.) And it’s something we very much need. I often find that it’s close to impossible for Boomers and Gen X/Yers (or whatever we’re called) to even countenance the idea of America not being numero uno. Many like the idea of a coming “multipolar” world, but the prospect that we would not be leading it is considered as implausibile as the Cubbies winning the World Series.  

If you’re a “tragic,” and you’ve thought seriously about a coming Great(er) Depression, then you’ve probably thought seriously about the crime waves and mass riots in the inner cities that might very well result from double-digit unemployment. And you’ve also considered what you might do amidst such chaos.

Luckily, one can banish these dark thoughts by letting one’s fancy light upon a vision of the quasi-tragic farce that might ensue once it begins to dawn on our political elites that they’re no longer Masters of the Universe. One can envision a hysteric and weeping Secretary of State Hillary barging in uninvited on diplomatic negotiations between representatives of two countries who’ve decided to resolve a dispute without the United States’ “help”—and who actually don’t much care what that country that owes everyone so much money thinks anyway. With mascara running down her cheeks, Hillary would cry out with indignation and shame, “Don’t you people remember that we’re fucking in-dis-pen-sable!” In facing up to declining power status, the Obama administration will likely make Communist hardliners of the early ‘90s seem reasonable and level-headed in comparison.  

I’d also add that I think there’s more to the tragic/comic distinction than merely changes in mood over the market’s ups and downs. Indeed, I find that the “tragic” and “comic” monikers actually distinguish two divergent schools of libertarianism, which, in fact, don’t include the same people and are based on radically different world views.

“Comics” at Reason like to reason that society isn’t just “getting better all the time” but since we are sooo consumerist and “diverse”—and just so darn gay—that a full-blown libertarian order is around the corner, if it’s not here already. Politics are a “lagging indicator” after all.

A “tragic” like Ayn Rand is different. The collectivist nightmare depicted in Atlas Shrugged—in which society is ruled by “Anti-Dog-Eat-Dog” legislation and the Department of Financial Stability and Recovery (oh wait, is that last one fact or fiction?—does not ultimately derive, for Rand, from some terrible socialist ideology that arises in the future. Instead it’s produced by the reoccurrence of something very old. There are spirits of resentment, slavishness, collectivism, and willed mysticism that are always with us—and which often win out. Rand’s vision is tragic in that individual greatness is always rising and falling, triumphing and being dragged down, dying and being reborn.

We are, as it’s becoming crystal clear to even the most comic amongst us, living in a moment of descent. But never fear: “All things fall and are built again,
/ And those that build them again are gay.”

So cheer up!    

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