Now Here's a True "Must Read"!

I am just beginning a very unusual book, When Corporations Rule the World, By David C. Korten. Both the author and his writing style are very unusual. The author is a 70 year old with an MBA and Ph.D. from Stanford's Graduate School of Business, who taught and did research at Harvard's Graduate School of Business and has thirty years of field experience working in Asia, Africa and Latin America for the Ford Foundation, the U.S. Agency for International Development, and a number of nongovernmental organizations (NGOs). With a background like this one does not expect to read a book like When Corporations Rule the World!!! Moreover, his writing is remarkably honest and extremely clear--one cannot mistake what his values are and what he is saying; this in itself is an unusual blessing. Here's an excerpt that gives the flavor of the book (pp. 9 & 12):

[T]he systemic forces nurturing the growth and dominance of global corporations are at the heart of the current human dilemma.... These forces have transformed once beneficial corporations and financial institutions into instruments of a market tyranny that is extending its reach across the planet like a cancer, colonizing ever more of the planet's living spaces, destroying livelihoods, displacing people, rendering democratic institutions impotent, and feeding on life in an insatiable quest for money.

But let me point out how the author is an authentic conservative as opposed to pseudo-conservatives such as William F. Buckley. Here is Korten's description of his "values" (a much-abused word in contemporary America):

With regard to political values, I remain a traditional conservative in the sense that I retain a deep distrust of large institutions and their concentrations of unaccountable power. I also continue to believe in the importance of the market and private ownership. However, unlike many contemporary conservatives, I have no more love for big business than I have for big government. Nor do I believe that posession of wealth should convey special political privilege. I share the liberal's compassion for the disenfranchised, commitment to equity, and concern for the environment and believe that there are essential roles for government and limits to the rights of private property. I believe, however, that big government can be as unaccountable and destructive of societal values as can big business. Indeed, I have a distrust of any organization that accumulates and concentrates massive power beyond the bounds of accountability.

OK, here's the essential kernel that separates the sheep from the goats: However, unlike many contemporary conservatives, I have no more love for big business than I have for big government. This is what separates many authentic conservatives from pseudo-conservatives. The latter chatter incessantly about the horrors of 'collectivism' inherent in 'big government'; but they are stone silent about the 'collectivism' that is only too obviously involved in the growth of the modern corporation since 1865 in the United States. Korten is a very unusual fellow in that he is consistent on this point.

Actually, I've just been thinking about the meanings of "conservative" and there is a strain within conservatism which says that rule by the rich and well-born is best and that the 'mob' cannot be trusted. (John Adams believed this.) If one takes that seriously then people like William F. Buckley could be labelled 'conservative' in the latter sense because they certainly do support the powers that be. However, in this case Buckley is simply a liar because he does not honestly state that he distrusts the people and thinks the rich and well-born (like himself) should rule; rather he uses a variation of classical liberalism like that of Milton Friedman to rationalize his views and identify himself as a defender of 'liberty'. He attacks the state but is an ardent defender of business and the corporation.

A Thought on American Corporations

Listening to National Public Radio News this AM I heard a piece on how California and Vermont want to regulate Carbon Dioxide emissions in automobiles and how the auto companies have formed a group to sue them and argue that states do not have the power to regulate these emissions. The Attorney General of Vermont mentioned how this foot-dragging on the part of corporations was just like the huge fuss they put up opposing catalytic converters. Yes, and I'm old enough to recall the fuss they put up about seat belts and airbags too. Corporations have HUGE resources and they use them consistently to fight any social progress that they perceive as a danger to their profits; the hell with the good of society--they just buy up an army of lawyers and PR people to spin and argue that black is white and up is down. That is certainly what tobacco companies did for years regarding cancer and whether nicotine was addictive. Exxon-Mobil has spent millions of dollars funding propaganda that undermines the evidence supporting the existence of global warming. Here's just one article about this. For more go here.

A Thought on the Libertarian Party

Having gone through the Libertarian Party website and examined their platform my only large problem was their failure to articulate a position with regard to huge muti-national corporations. They have an email address where they say they welcome questions and I asked them about their position regarding corporations but got no answer. I have noticed that writers like Friedrich von Hayek and Milton Friedman LOVE to denounce what they don't like in government by using the terms "collectivism" or "collectivization". I frankly can't recall reading how they define the term however. I would include the huge centralization achieved by the modern corporation as a prime example of modern collectivization. If they fail to do so I believe I'd consider that an inconsistency. Although people on the right in America LOVE to idolize Adam Smith it is a little known fact that Adam Smith was seriously concerned about corporations if not opposed to their being too frequently chartered. Why? For one rather obvious reason Smith was thoroughly serious about real competition and felt that owners of businesses should be fully responsible for their business practices and this was most likely to occur if they had something approximating face-to-face relationships with their customers as was the case with single owners and partnerships. Moreover, Smith could see the liklihood that corporations might wield disproportionate power over government and thus distort the political process. Any American who doesn't see that that has occurred in the United States really must have their head in the sand or be a died in the wool pro-corporate ideologue. (For Adam Smith's attitudes toward corporations, he called them "joint stock companies", see the 2003 Bantam Classics edition and read Alan Krueger's Introduction.)

Limited Liability Law, Corporations, and Moral Hazard

David Moss in When All Else Fails: Government as the Ultimate Risk Manager points out (pp. 67-8) that opponents of a Massachusetts limited liability law explicitly made the moral hazard argument:

Another common counterargument was the traditional one: that limitations on liability would encourage reckless behavior. This represented an early articualtion of the moral hazard principle, though the term itself was not used. "Men who are restrained only by the limits of their capital stock," Representative Sturgis maintained, "do not and cannot feel under the apprehension of those who are restrained, each one by his own personal jeopardy,to the amount of all his means: to the extent of his very livelihood.... Your best security always is in the apprehension of your debtor."

Nonetheless, when it came to removing all obstacles to passive investment in corporations, the fear of the moral hazard of irresponsible corporate managers did not carry the day. In 1830 Massachussetts passed a limited liability law.

Moss indirectly also points up a moral hazard of allowing corporations with unlimited liability. When the creditors of corporations could count on all investors to be responsible for the corporation's debt they were thereby encouraged to provide easy credit (p. 66):

the effect was to make credit abundantly available to corporate managers, allowing (and even encouraging) them to borrow recklessly and engage in wild speculation. This is precisely the opposite of what had been argued in 1809, when lawmakers figured that unlimited liability would help to rein in reckless investing.

In 1809 legislators were counting upon corporate investors with unlimited liability to rein in recklessness of borrowing by corporate managers. However, I suspect that Moss' point (p. 64) that "passive investors were largely at the mercy of the corporate directors who managed their companies" was probably most accurate even in ca. 1800. Corporate managers had much control and if creditors--because of unlimited liability--were enticing them with easy borrowing, this was a moral hazard created by the nature of the corporation itself. This situation could have been an argument against corporations.

However, the proponents of a limited liability law used the recklessness of borrowing under unlimited liability as an argument for corporations with limited liability. But corporations with limited liability also were subject to the moral hazard of irresponsible managers. Limited liability might have made creditors more cautious but corporate managers primarily responsible to passive investors still had incentives to be reckless with other people's money. In fact, if limited liability applied to corporate manager-investors it is conceivable there was more manager moral hazard with limited liability than unlimited. With unlimited liability creditors would have an incentive to tempt corporate managers, but managers themselves, with unlimited liability, would also have an incentive to resist temptation.

One More Point About Hypocrisy Regarding 'Moral Hazard'

I have often been impressed with how arguments can be creatively twisted in public debate and in courts of law to support almost any outlandish position. In my last post I noted how first state governments passed legislation enabling corporations thus making it possible to collect the money of many passive investors and place it in the hands of corporate directors, and then these state governments passed limited liability legislation protecting investors from responsibility for corporate debts above the limit of their personal investment. I noted how both the allowance of corporations and limited liability law created their own 'moral hazards.'

It is interesting to note that when Massachussets was debating whether to pass limited liability legislation the then Governor, an advocate of limited liability, used the following argument (David Moss, When All Else Fails: Government as the Ultimate Risk Manager, 2002, p. 64):

"It is not reasonably to be expected," Governor [Levi] Lincoln had observed in 1825, "that prudent men, except under particular circumstances of personal confidence in their associates, should be ready to incur even the possible risk of utter ruin, for the chance of profit, in the joint stock of a manufacturing concern."

In other words, the Governor was arguing that since investors in joint stock corporations were only passive investors, they required the guarantee of limited liability to be encouraged to invest where they had no opportunity for 'personal confidence in their associates' because the corporate directors were likely not personal associates.

So first the state of Massachussets passes legislation enabling corporations thereby creating a class of passive investors and creating the moral hazard of directors risking other people's money; and then, arguing that this newly created class of passive investors would not be sufficiently motivated to invest unless the state limited their liability as well, created yet additional moral hazards both for corporate directors and passive investors. Instead of arguing that perhaps the state shouldn't have enabled corporations and passive investors in the first place, the Governor parlays the original bet on corporations into the perceived necessity to limit the liability of passive investors in order to provide them sufficient motivation to invest.

To me this is a fascinating use of argument. Instead of considering the hypothesized reluctance of passive investors to risk their money in joint stock companies as perhaps a reasonable hesitancy of 'prudent men', or considering this reluctance as a possible indication that joint stock companies may have been a flawed idea, Governor Lincoln argued that this reluctance to "incur even the possible risk of utter ruin" must itself be swept away by limiting the liability of passive investors and actively encouraging them to risk their capital in joint stock companies.

If one is convinced that corporations and passive investors and limited liability are essential prods to economic growth I guess the Governor's argument makes sense. But there is an interesting lack of concern about moral hazard when it is argued that initial moral hazards were not enough and now we are required to create yet additional moral hazards to encourage both corporate directors and passive investors to take risks they might not normally be willing to take. In this phase of American history government is aggressively intervening in the economy to encourage risk taking. Later it will be argued that workers must take total responsibility for themselves and any even imagined possibility of certain types of risk taking on their part must be severely discouraged.

American Hypocrisy About Government 'Meddling'

In David Moss' When All Else Fails: Government as the Ultimate Risk Manager it is clearly laid out how much help state and federal governments provided for business and manufacturing in the late 1700s and throughout the 1800s: governments provided loans, allowed businesses to raise money through lotteries, provided cash awards for high quality textile products, passed laws enabling incorporation allowing companies to raise money from many passive investors, and passed laws allowing investors to assume only limited liability if the company failed to pay its debts.

Again, many people thought these aids were a good idea and if you do too that is fine. They probably were a good idea. But if government intervention was 'good' when it was helping businessmen to accumulate the fabulous wealth and power they did in the 19th and 20th centuries, why did it become 'bad' when governments turned to help workers and consumers in the late 19th and 20th centuries? I believe it is because having accumulated the vast wealth and power businesspeople had, they then used this to actively promote an ideology protecting their privileges and power. Since many attempts to help workers and consumers would cost businesses somewhat more, and since regulations inhibited the freedom of business to do what it pleased, businesspeople and their many allies within universities, the press, the legal profession, among politicians, et. al. aggresively promoted the laissez faire philosophy that said it was very bad for the government to 'meddle' in the economy.

It had been great for government to do all those things to help business but that was long ago and few remembered or reminded us about all that government had done. After the industrial revolution had completely changed the face of American society creating a huge working class and huge cites where before an agricultural society had existed, now it was bad for government to 'meddle' by passing child labor laws, legislating to protect women workers, passing laws for workers compensation for on the job injuries, etc.

And one of the major arguments used by opponents of legislation to aid workers was that such laws would create 'moral hazard.' If we passed legislation protecting workers against on the job injuries then workers would be encouraged to be more careless and would be discouraged from saving for their own security. Horrors! However, earlier legislation allowing businesses to incorporate and attract many passive investors and limiting the liability of these passive investors--this legislation won the day. Yet, a momemt's thought suggests that allowing corporations and limiting the liability of investors obviously created its own 'moral hazards.' Allowing corporate directors to raise large amounts of money from passive investors would encourage corporate directors to be more careless with Other People's Money than they would have been with only their own at risk. As David Moss wrote (p. 64):

With little or no control over the day-to-day affairs of their corporations, passive investors were largely at the mercy of the corporate directors who managed their companies.

This limited responsibility of corporate directors would encourage irresponsibility or 'moral hazard.' The passage of limited liability laws protecting investors from responsibility for corporate debts also would create moral hazards: such laws protected the director-investors too, thus encouraging them to take more risk with their limited responsibility, and these laws would encourage investors to be less careful with their investment dollars because their corporate debt responsibilities were limited. But, somehow all these pro-business 'moral hazards' that seemed to have worked out well for economic growth were forgotten. When it came to protecting workers and consumers imagined 'moral hazards' were conjured up to oppose and defeat such legislation.

Great American Myths

What I think of as the American Ideology is based upon some remarkable myths that live on and on though careful examination of our history demonstrates their utter falsity. One of the most central of these myths is that our history and success is based primarily upon 'rugged individualism.' Now don't get me wrong, America is a relatively individualistic country; but this individualism was much more in evidence when Tocqueville made his famous visit to America in the 1830s. This visit was largely before the primary effects of the Industrial Revolution had taken place. In the 1830s there were only the beginnings of manufacturing enterprises and railroads were in their infancy.

Moreover, our individualism was made possible by unique circumstances. We were inhabiting a large and abundantly rich continent whose prior inhabitants were no match for our technology and would in due time be killed or penned up on reservations largely of our choosing. (What happened to the Native Americans is what is currently happening to the Palestinians; if the Israelis are successful, as they have been so far, eventually the remaining Palestinians will be penned up in enclaves largely of the Israelis choosing.) Happening to have settled a very rich and extensive territory with only a small number of people Americans had the luxury of being individualists; there was enough territory so that most families could have their own plot of land to build a home and raise food for at least their own needs. In feudal Europe there was an already existent division of land and tenure that was very difficult to displace; not so in relatively virgin American territory.

But even given these unique circumstances facilitating individualism in America, it wasn't long before our government started to institute policies which replaced a relatively pure individualism with corporate forms. As David Moss wrote (p. viii) in When All Else Fails: Government as the Ultimate Risk Manager "deep government involvement in the management of private sector risks is nothing new in the United States, despite the nation's reputed commitment to laissez-faire." Or (p. 2): "Even in a country well known for its hostility to government, policymakers have emerged as aggressive risk managers. The purpose of this book is to explain both how and why this has come to be." Indeed, Moss continued (p. 3):

A close look at American history reveals that state and federal policymakers had been [providing insurance against certain economic risks]... at least since the dawn of the Republic. Yet most accounts in the popular press foster the opposite impression--that government 'meddling' with private sector risks is of recent vintage. Articles on the subject often hark back to some earlier time, when America was full of vigor and individualist spirit and when every citizen faced his own risks with a sense of stoic independence and pride. But such a time never really existed.

Let us just take one very important example which demonstrates very clearly that the American Ideology's myth of individualist free enterprise is thoroughly misleading: the legislative creation of public corporations and the passage of limited liability laws to protect passive investors.

The corporation itself, as Chief Justice John Marshall described it (Moss, p. 57) is "an artificial being, invisible, intangible, and existing only in contemplation of law." There are 'natural' individuals like you and me; we are naturally occurring beings that it took no legislature to create. 'Individualism' refers to us naturally occurring persons. And business originally was conducted by natural individuals, who owned and managed their own businesses and farms. Even the partnership involved active owner-investors who ran their own businesses. But then the state stepped in and created the corporation which made it possible for there to be passive investors, people who invested capital in a business but were not active managers. Thus, the very creation of the corporation itself, was the result of government supporting through legislation the accumulation of large scale capital for manufacturing enterprise. (Note also that creation of passive investors and corporations contributed to the loss of local, face-to-face community that conservative writers like Robert Nisbet deplore. When business was local and owned and operated by an active investor-owner you were more likely to conduct business and have a relationship with that owner. With the growth of corporations and passive investors more social 'distance' is created between the consumer and the business owner.)

I am not here addressing whether this was a good idea or not; my point is that in the very early history of America government was actively and positively supporting economic enterprise and pushing it away from the true individualism of natural persons who owned and managed their own businesses and farms, toward artificial and corporate forms. This is just as much government 'intervention' in the economy as today's interventions; the difference is that when government 'intervenes' to aid business there are fewer complaints; however, when government 'intervenes' to help naturally occurring individuals with workers compensation, unemployment, old age insurance, or health insurance--then the cries of those who have benefitted so greatly from previous government 'intervention' are heard complaining of government 'meddling', 'moral hazard', and the loss of our 'rugged individualism.'

But having created the corporation through legislative intervention in the economy, this was not enough. Apparently passive investors in corporations who could be sued for any and all debts the corporation incurred was too much of a risk for these rugged individual passive investors to be expected to take. Thus, legislatures passed limited liability laws protecting passive investors against any greater losses than the extent of their personal investment. This shifted risk from the passive investors in corporations to the creditors of these corporations; with such limited liability protections apparently more investors were willing to provide capital to corporate manufacturing enterprises facilitating the use of Other People's Money and the accumulation of capital available to corporate managers.

Again, whether you think this was the greatest thing since sliced bread--as many in America indeed did--or not, is NOT the point of this discussion. The passage of limited liability laws was quite clearly government 'intervention' in the economy just as much as is legislation passed today that would place limits upon corporate power. The difference is that today's corporations were provided these legislative advantages as much as 150-200 years ago and have had this time to grow rich and fat and develop armies of mercenaries who will now come to their aid when any contemporary threat to their government-provided privileges is mounted; indeed, the business class has one whole political party, the Republican Party, devoted almost entirely to defending its privileges. (Yes, the Democrats also are pro-business but of the two parties the Democrats are by far the more likely to try to take small steps to level the playing field by supporting the interests of ordinary working people as well as those of the business class. Besides, I am not anti-business, I am anti-special privileges and power that enable one sector of the society to confuse, obfuscate and dominate other sectors of society.)

Who Is the Most Genuine Advocate of Individual Freedom in Today’s America?

Individualism, meaning valuing the freedom of the individual to develop to the fullest of his/her own potential and ensuring that the individual can enjoy the full benefits of these efforts, is at the heart of the American belief system. Classical liberals like Milton Friedman and Friedrich Hayek embrace these values. The so-called American ‘conservative’ movement begun in the 1950s also claims to see individual freedom as central to its values. Interestingly, a case can be made that much of what has passed for American radicalism also is based upon belief in the promotion of individual freedom and development. Finally, ‘modern’ liberals too found their belief system upon the bedrock of individual freedom and development.

Obviously there must be important matters upon which these otherwise very different groups disagree. The most fundamental point of disagreement involves very different views of the role of the American state. Perhaps in an ideal world these different groups could agree that the state would play the minimalist role assigned to it by writers like Adam Smith. However, disagreement enters in assessing the historical actions that the American state has actually taken and whether this role fundamentally violated the ideal of laissez faire by repeatedly favoring those with more economic power enabling them to amass undue wealth and power. If one believes the latter then advocacy of laissez faire and opposition to government intervention in the economy at this late date only helps to consolidate the inequalities of wealth, power, and opportunity that exist today and thereby stands to undermine the freedom of the majority of contemporary individuals to develop themselves to their fullest potential and enjoy the fruits of these individual exertions.

While pseudo-conservatives like William Buckley and classical liberals like Friedman and Hayek inveigh against the state as the sole threat to individual freedom they completely overlook the massive growth of large corporations as agglomerations of power that can threaten individual liberty. They also apparently overlook the fact that the state has again and again done things to favor centralization of wealth and power in the hands of the American business class. These potential contradictions of laissez faire and threats to the freedom of all individuals do not seem to concern them. (To be fair to Friedman he often has attempted to be consistent by opposing at least some actions of government that favor business or professional classes.)

The contemporary call for minimal government by pseudo-conservatives and classical liberals and their virtually sole emphasis on the threats to individual freedom from the state are conveniently similar to the ideology of privileged classes in the U.S. In other words, modern liberals believe that these individuals’ ideology is not a true defense of individual freedom but a disguised defense of privilege and serve to undermine the freedom of less privileged individuals. This is where the real disagreements lie. The question is: who really is the most genuine advocate of individual freedom in today’s America?

Modern liberals and some individual freedom-loving radicals would argue that when pseudo-conservatives and classical liberals cast the state as virtually the only threat to individual freedom they are overlooking the fact that, unlike large corporations, the state is to some degree responsive to the individual through the vehicle of bi-annual elections. As Charles Perrow has written (Organizing America, p. 8):

Most important for government, however, is the check of democratic control on governmental masters through the electorate. The check is limited, imperfect, and subject to abuse, but there is no democratic control at all in the case of private economic organizations, on which most of us depend for our living. Only governmental regulation can attempt to control private economic organizations. Because governmental organizations are somewhat more responsive to the electorate in democracies, I fear large governmental organizations less than large private ones.

Apologists for corporations might argue that there are checks on corporate power: 1) votes of shareholders to elect boards of directors and 2) votes of consumers in the marketplace. These are specious arguments because any honest study of corporate governance would note that it is the unelected top managers of the corporation that control them; directors are nominated by top management and almost always rubber stamped by shareholders; moreover, directors exercise little significant power over top management. Votes of consumers in the marketplace are utterly different than votes in a democratic election; in the latter case one election can put candidates in office or remove them on a single day and such elections occur regularly at two, four or six year intervals; the purchases of consumers may take much time to have an effect on management, if any, and they do not directly involve anything other than the details of what products are produced and how; if consumers disagree with the political or charitable contributions of management or the company's environmental policy purchase of products is no substitute for democratic elections.

Conservatives, Liberals and Authoritarians: Cleaning Up American Political Terminology

In her The Authoritarian Dynamic, political scientist Karen Stenner has been a great help in clarifying the landscape of American political ideology. On p. 138 Stenner wrote that "the way in which the notion of 'conservatism' is typically employed in American politics... hopelessly entangles... three dimensions we have so far striven to distinguish: authoritarianism, status quo conservatism and laissez faire conservatism.... In contemporary U.S. politics, 'conservative' does tend to mean, all at once, intolerance of difference, attached to the status quo, and opposed to government intervention in the economy."

Stenner correctly distinguishes these three ideological stances and argues that they can be largely independent of one another; one can endorse laissez faire and be quite critical of the status quo (say you were a bourgeois for laissez faire in Louis XVI's pre-revolutionary France), one can support the status quo and be opposed to laissez faire (say you were a loyal Communist under Brezhnev), and, most important of all for my purposes, being a 'conservative' who wishes to avoid radical or abrupt changes in the status quo does NOT make you an authoritarian (say you are a moderate Republican critical of the Bush-Cheney administration's super-patriotism, hyper-nationalism, moral intolerance, and subversion of political dissent).

Stenner, with characteristic conceptual care, differentiates 'status quo conservatism' from authoritarianism (p. 151): to status quo conservatives “a stable, institutionalized, and authoritatively supported respect for diversity should always be preferable to dismantling those well-established protections and moving toward an uncertain future holding out prospect of greater uniformity of people and beliefs, yet at the cost of intolerable social change and uncertainty.” In other words, if you want to preserve the status quo and you in fact exist in a society respecting diversity, then that’s the status quo you’d wish to preserve; however, if you’re an authoritarian existing in a diverse society you might wish for even abrupt radical changes in the status quo if they promised more uniformity of people and beliefs. A 'status quo conservative' presumably would support whatever status quo existed in his/her society; an authoritarian is predisposed to want uniformity of people and beliefs in whichever society he/she lives and may be willing to risk change to increase uniformity.

Let's parlay this into a clarification of American political ideology.

1) As both of the two patron saints of laissez faire doctrine, Milton Friedman and Friedrich Hayek believed, those supporting laissez faire should not be called ‘conservative’ at all, but ‘classical liberals’ (here I depart somewhat from Stenner in that I agree with Hayek and Friedman that 'laissez faire' and 'conservative' designate different views). If contemporaries won't take the word of Friedman and Hayek that 'conservative' is an inappropriate term it's because ideologues like William F. Buckley wished to 'fuse' disparate and often contradictory ideological traditions for their own intellectually inconsistent political purposes. Buckley and those around him in the 1950s put together a witch's brew of 'conservatism' that still confuses American political discourse today. A true conservative, like Edmund Burke, refers to someone who opposes abrupt and/or radical changes in contemporary social institutions but supports temperate evolutionary changes as needed. (Two qualifications: 1) in the U.S., with its longstanding and widely held commitment to less government and more 'free' market, a Burkean respecter of the status quo would also tend to support laissez faire, but this is a culturally and historically specific association; historically specific because there were times in American history when leaders who were in many ways staus quo conservatives advocated more government intervention in the economy: e.g., Alexander Hamilton, Henry Clay; 2) since capitalism is always a force for innovation, change, and "creative destruction", it is difficult to be consistently pro-capitalist, i.e., laissez faire, and be a Burkean respecter of the status quo. Go figure. I suspect laissez faire and status quo are too often contradictory.)

2) Classical liberals, like Friedman and Hayek, are opposed to undue interference in the economy, and in society more generally (they would oppose legislating morality), by the central government. The libertarian (see U.S. Libertarian Party) of today tends toward the beliefs of the classical liberal, but also strives for consistency in pursuing liberty by supporting strong civil liberties, opposing government legislation of morality (support for women's rights to abortion), and opposing a meddlesome, interventionist foreign policy requiring the central government to have a huge 'defense' and 'national security' establishment.

3) So what's a 'liberal'? The ‘modern liberal’ or ‘progressive’ believes that the rise and growth of modern corporations in the America of the 19th century has interfered massively and significantly in the 1825 (pre-industrial) world of the classical liberal; this growth has enabled corporations to interfere with the ‘free market’, enabled representatives of corporations to exercise excessive influence over government and elections, and enabled the ‘collectivism’ of the corporation to exercise undue influence over most social decisions (environment, health care, retirement, unionization of workers, development of law, popular tastes, favored entertainments, use of the broadcast airwaves, etc., etc., etc.). Thus the modern liberal believes that government--as the only institution within modern capitalist society having adequate power to regulate the corporation as well as being under some popular control through democratic elections--that this central government must be supported in its role of corporate regulation. Other than this, and with some notable backsliding (McCarthyism, the Cold War, the 'war on terror'), the modern liberal probably agrees with the libertarian on many issues. That the three examples of 'backsliding' that came to mind concern foreign policy is no coincidence; probably the biggest problem for modern liberalism is that 'liberals' support aggressive, 'idealistic' foreign policies in which the U.S. brings its 'superior' values to the poor and benighted of foreign lands. I believe such interference in the affairs of sovereign countries contradicts liberal principles of freedom, equality before the law, and self-determination for all peoples.

4) What is an "authoritarian" or pseudo-conservative? As Stenner argues, an authoritarian is someone who likely has an innate disposition to strongly favor uniformity of beliefs for all members of society, and sameness of characteristics of all members, and thus tends to be racially, politically and morally intolerant of diversity and dissent; the authoritarian when threatened or challenged by a perceived excess of diversity and/or dissent responds with an aggressive, coercive punitiveness aimed at suppressing unwanted difference and enforcing uniformity upon others. Thus, George W. Bush and Dick Cheney, along with many of their most fervent supporters, are more accurately considered authoritarian pseudo-conservatives and should never have been labeled 'conservative' at all. Republicans like Dwight Eisenhower, Senator Robert Taft (1889-1953), and George H. W. Bush might more accurately be considered 'conservative'.