Monday, April 10, 2017

Interview: Tyler Cowen explains what made 'the complacent class' so complacent

Story by Joseph Ford Cotto

Libertarianism has seen better days.


A few years ago, certain political forecasters claimed that the future of America's center-right belongs to libertarians. Since the 2012 presidential election, however, protectionism surged -- not only in the GOP, but among Democratic ranks as well. Now, amid the age of Donald Trump, libertarianism's once-ascendant nature seems a distant memory.



"I fear that the classical liberal/libertarian idea and ideal will be seriously tarnished by the policies and politics of the Trump Administration," Dr. Richard Ebeling, one of our time's greatest Austrian School thinkers, recently told me.

He continued: "Virtually all of Trump’s proposed policies involve a continuation or an intensification of government involvement in social and economic life. He acts as the all-knowing government central planner when he calls in business executives and tells them where to invest and what products they should make to 'create jobs.' He undermines respect for and protection of essential civil liberties when he ridicules the freedom of the press and their way of reporting on his administration’s actions and his words."

Ebeling went on to state his worry "that with the assistance of the mainstream media the Trump Administration’s anti-freedom policies will tarnish the real case for a free society and a free market. That is, people who want lower taxes and fewer regulations on business will be identified as the people who also believe in torture, discrimination against immigrants, violations of civil liberties, and the instigation of trade wars because of aggressive nationalist attitudes."

One of the most capable emissaries libertarian thought has known is Dr. Tyler Cowen.

"Cowen is Holbert L. Harris Chair of Economics at George Mason University and serves as chairman and general director of the Mercatus Center at George Mason University," the biography on his website explains. "With colleague Alex Tabarrok, Cowen is coauthor of the popular economics blog Marginal Revolution and cofounder of the online educational platform Marginal Revolution University.

"A dedicated writer and communicator of economic ideas who has written extensively on the economics of culture, Cowen is the author of several books and is widely published in academic journals and the popular media. Malcom Gladwell described Cowen’s latest book, The Complacent Class: The Self-Defeating Quest for the American Dream, as “brilliant.” The book explores why the change that drives America forward has stopped. He writes a column for Bloomberg View; has contributed extensively to national publications such as the Wall Street Journal and Money; and serves on the advisory boards of both Wilson Quarterly and American Interest. His research has been published in the American Economic Review, the Journal of Political Economy, Ethics, and Philosophy and Public Affairs."

Cowen recently spoke with me about many of the matters raised in The Complacent Class. The first half of our conversation is included below.

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Joseph Ford Cotto: More than anything else, what has made 'the complacent class' so, well, complacent?

Dr. Tyler Cowen: Some of the complacency has been a reaction against the violence and chaos of the 1960s and 70s.  Starting in the 1980s, America decided it was going to have a much calmer, safer country.  Mostly that was for the better, but we went too far in trying to remove all dimensions of risk.  Just look at how ridiculous helicopter parenting, and the unwillingness to let kids play outside, has become.

Another factor has been information technology.  Facebook improves our leisure time.  We stay and home and receive Amazon deliveries and watch Netflix.  That's nice, but it also is important to have more technological innovations that improve productivity in the workplace.

Cotto: 'The American Dream' is a big theme in your book. You found that, quite often, when people try to actualize this vision, the results are far from inspiring. To what can this be attributed?

Cowen: If everyone tries to limit their personal risk, overall the economy becomes less flexible, labor becomes less mobile, capital doesn't respond to change quickly enough, and we innovate less.  The long run result is that, counter-intuitively, we are all exposed to more risk, precisely because we tried to banish risk from our lives.  Right now, American society is under-investing in risk-taking, but it is hard to break this circle precisely because it is comfortable or at least non-threatening for so many individuals.

Cotto: Judging from your research, when Americans fall into an economic rut, which typically has social ramifications, why are they frequently not motivated to strive for something better?

Cowen: We are wealthy enough to afford a fair number of individuals in ruts.  Plus the internet makes free time more bearable, and also we live in an era of living with one's parents, smoking marijuana, playing video games, and viewing pornography.  Getting on disability is more of an aspiration than it used to be, even though jobs overall never have been safer.

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