Planned economies, freedom, and redistribution of social goods

I just read a cool quote by George Orwell, written in 1944:

"Such is our present predicament: Capitalism leads to dole queues [read: unemployment and state subsistence], the scramble for markets, and war. Collectivism leads to concentration camps, leader worship, and war. There is no way out of this unless a planned economy can be combined with freedom of the intellect."

With this, Orwell hints at one of the ironies or contradictions of capitalism: markets have the capacity to destroy social bonds, thus containing the inherent potential to destroy their own stability; yet, markets at both the domestic and international levels also have the great capacity to integrate people.

Ignoring the equal (maybe even greater?) potential for self-inflicted destruction, many Adam Smith-centered libertarians trumpet markets solely as self-regulating forces for good, focusing only on the potential of markets to create peaceful orders that encourage mutual reliance and thus discipline, probity and honesty. Smith, however, proved himself overly utopian in his conception that both the economy and society could be protected from state penetration, could be left to reproduce unfettered, or that they would maintain social solidarity. Never mind the fact that modern capitalist markets depended from the start on the shaping and protecting activities of states. Never mind the fact that, in The Wealth of Nations, Smith himself stakes out a role for the government in defense, public works, education, and especially in the establishment of a framework of law. (For without such a system of justice, a market system is not possible.) Only Marx seems to have called for a total "withering away" of the state with his far-fetched idea of an enlightened proletariat organically developing a stateless society.

As we have seen from capitalism's previous cycles of boom and bust and the state's role in helping put the system upright again, the establishment of an economic order based solely on self-regulating markets (Smith's "invisible hand") are necessarily followed by the sucidal demise of these markets' self-regulation. This has been seen, perhaps most clearly, in the past several months of economic turmoil. The untamed market commits the sin of gluttony and eventually eats itself to death.

Ever since modernity's division of the human experience into state, economy, and society, the sight of ceaseless contestation has not been whether the state should have a role in our economy and society, but how it should do so, with what checks, and with what degree of mass participation and consent. For, as the state shapes and mitigates markets, it redefines the autonomy and flexibility of that market. And, importantly, it also opens up possibilities for self-conscious social engineering.

Our democratic system of government provides we, the people, with quite an honor and challenge to choose how we will redefine our markets and help shape our social system. I respect the conservative inclination to maintain what they believe are traditional methods of virtue, despite my great disagreement in our conceptions of virtuousness. I see the Republican party's virtues being centered on individual gain, self-interest (especially for those already empowered), and a reluctance for the government to use its potentially vast resources for social betterment. The values I see espoused in the Democratic party revolve around the idea that we're all in this together, by working together we make our whole greater than its sum, and that government can work to help make a more equitable and just society while maintaining social and intellectual freedoms.

The challenge, as Orwell states above, is to orchestrate a planned economy with the greatest degree of freedom. The idealist in me hopes, and even believes, that we're currently on that very path now. If so, it'll be amazingly ironic that the greatest government interventions in the history of our country (as obviously occurred over the past 8 years), were brought on by a right-wing, self-described "conservative" administration. Likewise, won't it be great if (when!?!) those state policies are scaled back in some cases by a so-called liberal Democrat, who then plans to redirected that state involvement toward a more just distribution of resources? After all, the purpose of taxes in our nation's history has always been to redistribute wealth and facilitate democratic state intervention. Whether the burden of payment falls on the struggling and disintegrating middle class (as it would if Bush's tax cuts became permanent, which McCain desires), or if the burden falls upon the rich who have a greater ability to shoulder such national responsibilities, tax redistribution always occurs with each year's necessary payment to our government.

I, as you know, favor Obama's policies of each of us helping each other out. That's the mixture of freedom and state intervention that I think can make "Morning in America" all over again.