Mont Pelerin Society Day II

Yesterday’s papers were fascinating – especially the session on neuroscience and human nature.

Not sure when I will get the time to blog a summary. Today’s sessions are:

• Externalities: Beyond Coase, Williamson and Ostrom
  • The Problem of Social Cost: What Problem – Professor Harold Demsetz
  • Coase Rules OK – Professor Jeff Bennett
  • If Hayek and Coase were Environmentalists – Professor Terry Anderson
• GFC: What have we learnt from the 2008-09 event? A Stocktake
  • Been There Done That – Professor Peter Boettke
  • After the Fall – Professor Deepak Lal
  • The Global Financial Crisis and the Efficient Market Hypothesis – Professor Ray Ball
• Australia – A Generation of Economic Reform
  • A Generation of Reform – Professor Wolfgang Kasper
    A Generation of Reform – Paul Kelly

In discussing the French Enlightenment yesterday, a pertinent quote from the presentation was:

One of the dramatic ironies of the Persian Letters was that Montesquieu‟s fictional Persian traveler, Uzbek, could see despotism everywhere it occurred in Europe, but he was wholly blind to his own despotism with regard to his harem. Montesquieu saw painfully that it was a part of human nature itself to be aware of all abuses of power but their own.

Professor Kors went on to note that is why we limit power itself. Worth reflecting on in the light of the Canterbury earthquake legislation, but even beyond that on the fact we have a unicameral Parliament with no written constitution.

And on the Scottish Enlightenment, Professor Otteson looked at society today:

Western society faces similar declines and decay, though the proposed explanations differ.

American conservatives may point to the decline of the “nuclear family” and of the role fathers play in families, to an increasing disrespect of justified authority in people’s lives, and to the selfish egotism that contemporary American “liberal” culture espouses. Libertarians may point to the increasing role the state plays in our lives, in removing the necessity for us to take care of ourselves or others or to face the consequences that bad behaviors naturally have. Liberals, for their part, may point to the greed and materialism that they believe capitalist corporatism
encourages in turning our attention away from things that truly matter in life.

There may be truth in all these claims. Yet each is possible only because of the growing wealth that commercial society has enabled. Take the conservatives’ concern. In many ways, wealth has rendered fathers obsolete: they are no longer needed to provide for their women or their children, because the women can do it themselves or the state can do it. To the libertarians: the state is able to take such a large role in our lives (for good or ill) because we have the money to pay for it. To the liberals: our wealth has systematically satisfied all our most pressing, fundamental needs and so, naturally, we increasingly turn our attention to less pressing, more superficial, even crass desires.

The Scots foresaw these potential risks of commercial society over two centuries ago. Ferguson knew that markets and commercial society were coming, whether he or anyone else liked it or not, because everyone would want to enjoy their benefits. On the other hand, like Smith he also imagined the degrading and disgracing effects it would eventually have on humanity’s virtue: he believed we would become in time a race of wealthy but ignoble creatures, unable to appreciate or even recognize virtue, incapable of rousing ourselves to vigorous action because our faculties had atrophied, and, finally, unable even to contemplate, let alone achieve, true human happiness.

Wise folks those Scots.