Economic policy isn’t baseball, it’s war

This is how Israel functions; an example of a “total state,” an albeit somewhat benign totalitarianism, with the government’s hand in everything.

By ZEV GOLAN
April 24, 2013 22:45
EL AL planes lie at rest at Ben-Gurion Airport earlier this week due to a strike

El al plane at rest 370. (photo credit: REUTERS)

Capitalism vs socialism is the modern term for the battle between freedom and control, or responsibility and being cared for, or liberty and totalitarianism.

French philosopher Jean-Paul Sartre wrote that man is condemned to freedom.

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He does not choose to be born or free; he is condemned to it by fate or God or chance.

The person who is free is needless to say responsible for himself, his choices, and what amounts to his fate. Many people, not having asked for this responsibility, or frightened by it, flee from it. Some want to lose their individuality in larger groups such as an economic “class” or a social sector – any group in which their failures will be forgiven and in which they will not have to bear responsibility for their opinions or the heavy decisions of their lives.

In the 1990s, a Histadrut labor federation spokesman castigated Prime Minister Binyamin Netanyahu’s plan to give employees control over their pension plans, saying, on national television, “We will not allow the government to make people responsible for their own fate.”

So, two views present themselves: The Histadrut, and in recent history, socialism or social democracy, call for government control of the economy and the life of the individual, for society’s own protection – and, supposedly, to ensure the division of resources is more or less equal. Since the government is not a person, but is rather composed of people, what this means is that other people are to be responsible for a person’s education, health, housing, investments, retirement planning, and even cultural choices.

This, indeed, is how Israel functions; an example of a “total state,” an albeit somewhat benign totalitarianism, with the government’s hand in everything.

This approach has been taken so far Israelis react equanimously when elected government officials, or career bureaucrats, see a need to control how much “quality” programming is available to them on television, the number of commercials they will see in an hour, or who should own the newspapers they read and radio stations they listen to.

An alternate view is that of those who were once called economic liberals and are now called conservatives or supporters of free markets and capitalism. They hope to limit the size of government and decrease its involvement in a person’s religious, economic and other choices. They argue that liberty is a value to be fought for, but they also argue that it is more efficient than government planning and control. Individuals, they say, will make better decisions than bureaucrats – they will ask neighbors or search the Internet for information about doctors or schools rather than rely on state ministries, and will spend their money on concerts, theaters and newspapers as they see fit, thereby encouraging a true national culture.

Arguably, the psychological forces behind these views have been at war since humans have been able to think – and since some humans preferred not to be forced to think. Some people are happy with themselves, or happy with their lot, and want freedom; others are jealous of their neighbors and want someone to make them equal, or punish the neighbor, and are willing to forgo their own freedom for this purpose.

Some people want to fend for themselves and others prefer to let others – whether rabbis or social scientists or governments or newspaper commentators – think for them or support them financially.

In the United States, American history and culture provide role models for both sides of the game. In good schools, teenagers learn about the arguments among the country’s founding fathers on some of these issues. Books that deal with controversial presidencies, during which these debates were strong, sell well. And books by writers like Ayn Rand continue to sell millions of copies half a century after their original publication, affording new generations examples of different kinds of people.

A common critique of Rand is that she simplified things, portrayed the conflict in black and white. She described the individualist who thinks and works for his own happiness as heroic and the person who adopts other people’s values or wants a share of money he hasn’t earned as a failure or a villain. But this black-and-white view provides a simple scorecard making it obvious what the argument is about. Ultimately, a politician may compromise between the capitalist and welfare-state approaches, a voter may favor a policy that limits his own freedom, or they may keep more closely to Rand’s view – but in any case, they will know what hangs in the balance in the debate over economic policy.

Israeli culture, based on the state’s founding myths, glorifies only one approach: that of the socialists, kibbutzim and Histadrut, and offers Israelis no scorecard by which to know what lies behind calls for more funding for theaters, governmental television, state-run nursery schools, taxpayer-funded government investments and so on.

The publication last year of new Hebrew translations of Rand’s The Fountainhead and Atlas Shrugged is therefore an important event; and this month, the Jerusalem Institute for Market Studies is publishing a Hebrew translation of Frederic Bastiat’s “What is Seen and What is Unseen,” an easy-to-understand primer on what lies behind economic slogans and policies.

It is frightening to those who value liberty to hear calls for more state control of people’s lives – from “age zero,” as several Israeli politicians have said – increased taxation of individual earnings and more bureaucracy. Often, some view election results or government policy, even a worldwide trend in policy, as indicating a victory for one side of the debate. Recent history has shown that no political changes have been permanent, because the battle has – and inevitably will – continue. One cannot condemn a moral view he opposes and expect it to disappear; the purpose of condemning it is to combat it in a war that is as old as history, and that will continue at least until a messianic era.

The writer directs the Public Policy Center at the Jerusalem Institute for Market Studies.


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