Bistable morphology

The threat to a completely free anarchist society is contained within the very assumptions that make it possible. If an anarchist society is not to spin itself apart from the outward acceleration of every man acting in his own (unenlightened) self interest, it is because a large portion of them act from a communal spirit and the recognition that compromise may be necessary from time to time in order to preserve relations with your neighbors. But that very idea of communal spirit is what may lead them to realize that the establishment of one gang may help to prevent the rise of another unpopular gang or multitude of gangs (who apparently have their own sense of community). Thus, the seed of destruction is assumed to lie within the anarchists' psyche.

The threat to a completely controlled social democracy is contained within the very assumptions that make it possible. If a social democracy is not to collapse into totalitarian dictatorship, it must be because a certain portion of the community insists on maintaining tolerance of dissent and individualism and therefore on maintaining a certain amount of friction and divisiveness. But that very idea of nonconformism is what may lead to the establishment of rebellious factions and heretics and perhaps even the destruction of the group cohesiveness that was the essence of the social democracy. Thus, the seed of destruction is assumed to lie within the social democrats' psyche.

These are sketches of what may be, and not even original sketches (Madison covered the same ground in Federalist No. 10). Other possibilities are that the societies described allow themselves to go down another path of destruction: the anarchy becomes a bellum omnium contra omnes, the violent and chaotic conditions assumed of anarchy that apparently accompanied the destruction of Saga Period Iceland, while the social democracy becomes one of the many totalitarian states that have arisen in the last 100 years: fascist Italy, Nazi Germany, falangist Spain, Vichy France, and communist Russia, China, Cuba, Estonia, Georgia, Poland, Lithuania, Armenia, Ukraine, Belarusia, Azerbaijan, Albania, Viet Nam, Hungary, Yugoslavia, Czechloslavakia, Romania, and East Germany. So it is possible that the destruction of a society is not that it turns into its opposite (anarchy into social democracy, social democracy into anarchy), but that the society fails to correct its internal problems at all, following them instead to their ultimate "logical" extremes.

Bowling Alone Means Anarchy?

When I try to imagine what an anarchist future would look like, it does not look like a bunch of cranky hermits sitting alone in their caves and refusing to talk to each other. Rather, it looks like a village of equals, engaging their neighbors in various projects. It looks a lot like the world that de Toqueville visited, but without the slavery and burgeoning symbiotic industrial and state hierarchy. But maybe that's just my naive take on it; frankly, I don't think it's very realistic. Judging by Robert Putnam's Bowling Alone: The Collapse and Revival of American Community, his version of anarchy lies somewhere between Hobbesian bellum omnium contra omnes and one in which everyone retreats behind computer and TV screens and refuses to interact in meatspace.

The book divides its subject, American withddrawal since roughly 1960, into four sections. The first is a cataloguing of all of the data which shows we are less involved with one another through everything from Free Masonry to cardplaying; the second is an analysis of why this has happened; the third is a discussion of the benefits of our lost communalism, and the fourth is a set of recommendations to restore the participation experienced in the 1950s. I found them decreasingly interesting as I went.

Putnam's region of interest lies roughly in the 1920-2000 period. Americans volunteered, participated, met, played, and dined with each other in increasing numbers, with a slight dip in the early 30s and a rapid expansion in the 1940s. Then, like a switch had been turned off, the trend reversed itself, giving up all of the postwar gains by the late 90s. This pattern is repeated in everything from joining fraternal organizations and attending church to joining bowling leagues to hosting neighbors at a dinner party. I find this fascinating because it gets at what I would consider to be a central problem for anarchists: how do people engage in community activities and collective action absent a central authority (be it church, state, or other). The data seems overwhelming that things do vary over time and specifically that there has been a significant decline since 1960.

There is a problem in that Putnam looks only at what was and finds less of it, rather than what is and looking for the growth in new things. Putnam notes these problems and seems hopeful (in 1999) that the social aspects of the internet will lend themselves to increasing contact, but there is still room for skepticism. In the historical record, there is another technology that held out similar hopes, but seems to have failed miserably in this regard: the telephone. When the phone first came along, there was some hope that it would allow people to keep in better touch and to meet new people, but studies show that people use the phone to strengthen existing relationships. To use Putnam's terminology, the telephone reinforces bonding social capital rather than bridging social capital.

The next section seems more problematic. While he spends many pages to exonerate the entry of women into the workplace, and more to partially convict television, he spends just over one page exonerating the state. He does this by noting that state spending barely changed in the period as a percentage of GDP. This seems disingenuous at best. I think the reason becomes more clear as he proceeds through the next two sections.

In the section describing the beneficial effects of social capital, he notes in the chapter on the wealth effects that social capital is as important in improving welfare as the free market. I would say, "duh." The idea of the lone entrepreneur struggling to establish himself is a Randian caricature. While it remains popular as a story-telling device, most credible biographies of "great men" note their partnerships and collaboration with other great men and women.

He wraps this section up with a discussion of the "dark side of social capital". In this section, he points out that we seem to have gotten more tolerant of racial and religious diversity even as we have gotten less involved in our communities. He includes a table like this:

	Low social capital	High social capital
High tolerance	Individualistic: You do your thing, and I'll do mine	Civic community (Salem without "witches")
Low tolerance	Anarchy: War of all against all	Sectarian community (in-group vs. out-group. Salem with "witches")

Note where anarchy falls. Clearly, he favors the civic community, but -- surprise! -- so do most anarchists with whom I am familiar.

Later, when describing what should be done to restore American community, Putnam tips his hand and reveals his real interest in social capital: he idolizes the Progressive period and the resulting increase in scope of state action. Curiously, it seems that his analytical skills abandon him at this point. He begins by noting the Gilded Age period preceding the Progressive Era and finds it wanting, and then locates all of the success in the Progressive period. He doesn't use "hyperindividualist" to describe the Gilded Age, but comes damn close. But if you look at the data he provides, you can see that community activity is clearly growing during the Gilded Age and peaks and perhaps even falters during the Progressive period. Why is the peak period considered to be the most successful? Why no interest in the growth that preceded it, or in the reasons that activity fell off immediately afterward? I would think the interesting research would be in looking at change and the reasons for it, not steady state operation.

Fortunately, Putnam provided the frightening part of the answer in an earlier chapter. It appears that people tend to volunteer more as a result of national crisis. Thus, WWII is cited as an influential national experience that led to the rapid rise in participation that followed. It seems likely that the expansion of the 20s followed from WWI. But why the peaks in the 1960s and the 1910s?

I propose that Putnam did not give the growth in the scope of state activity the attention it deserves. He begins

Circumstantial evidence, particularly the timing of the downturn in social connectedness, has suggested to some observers that an important cause -- perhaps even the cause -- of civic disengagement is big government and the growth of the welfare state. By "crowding out" private initiative it is argued that state intervention has subverted civil society. This is a much larger topic than I can address in detail here, but a word or two is appropriate.

On the one hand, some government policies have almost certainly had the effect of destroying social capital. For example, the so-called slum clearance policies of the 1950s and 1960s replaced physical capital but destroyed social capital, by disrupting existing community ties. It is also conceivable that certain social expenditures and tax policies may have created disincentives for civic-minded philanthropy. On the other hand, it is much harder to see which government policies might be responsible for the decline in bowling leagues, family dinners, and literary clubs.

From here, he looks at a chart of aggregate spending and, finding no significant change, declares state action to be unrelated to the problem. A word or two in rebuttal is appropriate.

First, while it may be hard to see which policies might affect bowling leagues and literary clubs, Putnam himself repeatedly asserts (presumably with the data to back it up) that there is a great deal of symbiosis between various types of social capital-building activities. Thus, if a state policy subverted, say, fraternal organizations, then activities that grow out of those bonds might tend to suffer. Bowling leagues associated with the Knights of Columbus, for example.

Second, while Putnam acknowledges David Beito's work in Mutual Aid, he doesn't seem to have absorbed the one relevant thing that he should have been most interested in from Beito's account. That is, that Mutual Aid organizations became so happy with the outcome of their efforts that they began to lobby their respective States for policies to mandate worker's insurance, and this was successful to their own detriment. After the States adopted laws to pay out unemployment insurance, there was no exclusionary reason to belong to a mutual aid society (see Manur Olson's Logic of Collective Action for explanation and expansion of this theme), so they closed their doors, and with them, presumably, a host of other activities suffered. Thereafter, the federal government began to get involved in this sort of activity (see here). At that point, the center of decision-making and power has moved far away from the community. Considering how this pattern has been repeated for education, care for the elderly, health care, and other aspects of life, is there any wonder that people are less involved with their neighbors?

Third, Putnam is disingenuous when he says he doesn't have room to address the question: he spends many more pages discussing urban sprawl. He is also disingenuous when he looks at aggregate spending rather than at the changing emphasis within the spending (from defense to social matters) and the expanding scope of what the state was getting into.






















Look at that ramp-up in spending from 1940 onward, and note the changing structure from the 1960s onward. Defense stops being the dominant component sometime during the Viet Nam war.

Furthermore, laws don't only cost the state time and money, they frequently cost the citizens in the way of unfunded mandates and unintended consequences. If I have to spend more time trying to understand and comply with laws, that is time I cannot spend with my neighbors. While time loss is a theme that Putnam explores deeply with regard to other explanations, he doesn't even mention it in passing with respect to the state.

In the end, while I am sympathetic to the general program of looking at community participation and social capital, I was not happy with what I perceived to be Putnam's goal. He does not seem to think that social capital is valuable in and of itself. Rather, he seems to believe that social capital is valuable as a means to petition government for more programs. Ironically, he seems to be surprised or curiously uncurious whenever the people succeed in getting those programs, as happened after the first Progressive hey-day (after 1920) and after the expansion in the welfare state in the 1960s.

Nth best, Posner-inspired

There are people out there who believe in this simple model:










This is a decision tree that says there are two choices: transactions with no problems -- no institutional failures, no externalities, a perfect market transaction -- and those that must be regulated. Of course, any regulation can be justified after the fact. If nothing else sticks, you can always invoke asymmetric or imperfect information, the last refuges of scoundrels.

But Posner makes an interesting point in Economic Analysis of Law that is rarely acknowledged by fans of regulation. He says,

Monopoly, pollution, fraud, mistake, mismanagement, and other unhappy by-products of the market are conventionally viewed as failures of the market's self-regulatory mechanisms and therefore as appropriate occasions for public regulation. This way of looking at the matter is misleading. The failure is ordinarily a failure of the market and of the rules of the market prescribed by the common law [emphasis added]. Pollution, for example, would not be considered a serious problem if the common law remedies, such as nuisance and trespass, were efficient methods of minimizing the costs of pollution. The choice is rarely between a free market and public regulation. It is between two methods of public control -- the common law system of privately enforced rights and the administrative system of direct public control -- and should depend upon a weighting of their strengths and weaknesses in particular contexts.

We can diagram this as:










But wait: it would be rare that a transaction would have a single institutional (market) failure, would it not? In fact, many if not most transactions are subject to multiple failures. The problem for the knee-jerk regulator is that they don't all work in the same direction. As I argued here, they may frequently cancel:

The state ownership of oil and the corresponding ease with which OPEC should be able to cartelize should raise the price, while externalities imply an artificially low price - which dominates? We know that the cost of our interventions in oil-producing regions is not accounted for in the price, but the risk premium brought about by the unstable regimes and regions that happen to possess the oil and our interventions in them is. Now add Hotelling into the calculus, and figure that the cartel members are going to cheat to drive prices downward, while federal taxes and regulations (not all of which are rational or efficient) raise the price.

So our decision tree now has four branches: no failure, self-canceling failures, common law, and regulation.









We can also add in the self-enforcing means open to private actors as suggested by Second Best Economist Dani Rodrik: repeated interaction, reputation, and collective punishment.













And since we're differentiating between types of self-enforcing agreements, why not differentiate between regulations? There are at least four; regulating inputs (as in the original Clean Air Act which mandated scrubbers), regulating outputs (as in mandating the use of MTBE in boutique fuels), taxation (alcohol) or user fees, and cap & trade (exemplified by sulfur dioxide markets created by the 1990 Clean Air Act).














This now looks like a rich spectrum of responses, many of which are open to private actors and therefore anarchists. I think it should be apparent now why I believe that regulations -- especially of the inputs or outputs -- are frequently a simplistic, unimaginative response to the particular class of institutional failures, real or perceived, known as market failures. True, not all are appropriate in a given situation, but it is rare to find a politician or state enthusiast who even recognizes that there are other options.