That is the new book by Angus Burgin and the subtitle is Reinventing Free Markets since the Depression. As I had suspected, it is interesting. Here is the core thesis:
To Hayek and the other founders of the Mont Pelerin Society, Friedman’s ascent within its orbit reflected the collapse of its attempt to integrate a restrained defense of free markets into a traditionalist worldview. In the broader social environment Friedman’s rise portended, and precipitated, the triumphant return of laissez-faire.
One thing which strikes me reading this book, as it does when I reread Friedman’s 1962 Capitalism and Freedom, is how much market-oriented writers of that era were not focused on the problems of old people, even though today those problems take up a huge chunk of the budget of the federal government.
I found this excerpt interesting:
In stark contrast to the early post-war years, Friedman would conclude near the end of his career that “there are too many damn think tanks now,” adding that they simply “don’t have the talent for it.”
“is how much market-oriented writers of that era were not focused on the problems of old people, even though today those problems take up a huge chunk of the budget of the federal government.”
What percentage of the population was old people?
If we had 40 million more young people would funding social security still be a problem?
No?
Ok… then you can blame abortion for the problem.
Birth control too, I expect?
Good point.
That means that both have an externality.
Does this mean that the Pigou Club thinks they should be taxed (instead of subsidized as they are now).
This would be an acid test for their commitment to their theory.
Would they always be a negative externality? That’d mean an ever exploding population.
Fwiw, abortion is used to time fertility also. That would mean that the number of abortions is not equal a gross reduction in population, though it does shift the age distribution of the cohort.
Not the greatest issue for an anti-abortion campaign. A woman could have 5 kids and 5 abortions over her lifetime. Where would that leave her? There are stronger anti-abortion arguments elsewhere I think.
However, the idea of of a strong Pigovian tax for the infertile is indeed fascinating.
A Pigovian tax is meant to change incentives. Infertile people wouldn’t respond to those incentives. Please don’t use words in a careless way, especially words that concern sensitive subjects like infertility.
Or blame immigration restrictions.
I don’t think abortion played a major role, if any, in the demographic shift. And there doesn’t seem to be a strong correlation between abortion legality and fertility rates anyway. For example, Poland, Japan and south Korea have highly stringent abortion restrictions by western standards, and they have some of the lowest birth rates on the planet (they’re all sub 1.4 – disaster territory). By comparison, some of the countries with more liberal regimes have better demographics, eg France and the USA.
Why is sub 1.4 ‘disaster territory’ and higher rates ‘better demographics’ Just because some retirement schemes are based on continuous population growth doesnt mean that continuous population growth is inherently better than population decline.
If we had 40 million more young people, then funding public education would be a problem.
There’s also the large amount of hormones released into the environment, and the change in women’s preferences for men which blows up when they go off the pill. But maybe the latter is internalized, if they know about the effects.
One thing which strikes me reading this book, as it does when I reread Friedman’s 1962 Capitalism and Freedom, is how much market-oriented writers of that era were not focused on the problems of old people, even though today those problems take up a huge chunk of the budget of the federal government
I do recall (don’t have my copy handy) that in the Constitution of Liberty, Hayek does discuss the major long-term fiscal impact of universal pensions, although it’s not a major focus for him.
Reading CoL revealed to me how far “left” Hayek was in many ways; while his support for a social safety net and some state involvement in health care is well known (and set out in RtS), in CoL he goes well beyond that supporting, for instance, municipal plan codes, proactive antitrust enforcement and many other things.
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