Tag Archives: freedom

Fiscal rules and election campaigns

24 Sep

As the UK Labour Party’s annual conference kicks off this week, ideas are beginning to emerge about what Labour will offer in the run up to the 2015 general election. One of these ideas is to have the country’s independent budgetary body, the Office for Budget Responsibility (OBR), to audit all of the pledges made by Labour in its election manifesto. Assuming that Labour’s tax and spend plans are found to be consistent with budgetary discipline and pledges on meeting deficit and public debt targets, the OBR would thus bolster Labour’s claims to responsibility and sound fiscal management.

This idea is nothing new for the Labour party. When Tony Blair carried his party to victory in 1997, he had promised to match Tory party spending commitments. This pledge had been intended to bury the long-standing image of the Labour party as a motley crew of profligate leftwingers. Over time, we have seen fiscal policy steadily depoliticized through the creation of fiscal councils and various fiscal rules, a development supported by the Left and the Right. The IMF estimated in 2009 that 80 countries in the world have adopted a fiscal rule of one kind of another. Debt brakes have been inscribed into constitutions in Germany and in Switzerland. In the UK, the OBR was created in order that government be made accountable to an independent body for its public spending. Elsewhere, fiscal councils with varying powers have become a common feature of the macro-economic policymaking landscape, as the table below highlights.

Fiscal Councils

Austria

Government Debt Committee (1997)

Belgium

High Council of Finance (1989)

Canada

Parliamentary Budget Office (2008)

Denmark

Economic Council (1962)

Germany

Council of Economic Experts (1962)

Hungary

Fiscal Council (2008)*

Netherlands

Central Planning Bureau (1947)

Slovenia

Fiscal Council (2010)

Sweden

Fiscal Policy Council (2007)

United Kingdom

Office for Budget Responsibility (2010)

United States

Congressional Budget Office (1975)

* Hungary’s fiscal council was dismantled in 2010

The European Union as a whole is organized around a set of budgetary rules that are policed and monitored by the European Commission, the so-called Fiscal Compact of 2012.  Monetary and fiscal policy are slowly starting to look alike as both policy areas come under the oversight of independent bodies of experts.

The idea of the British Labour party to submit manifesto promises to an independent audit takes this idea one step further. The message is clear: a promise made about spending by politicians is only credible if it has been overseen by a body of experts. Credibility and responsibility lies with apolitical bodies. Politics, itself, is the terrain of half-truths and misleading creative accounting.

One problem with this is the idea that once a policy has been given the stamp of approval by a body of experts, it becomes incontestable. Especially in the realm of fiscal policy, this is nonsense. Spending plans are notoriously subject to revision and change because they rest upon assumptions about the wider economy. Small changes in growth projections throw even the most carefully prepared and audited spending plans into disarray. That a party’s manifesto commitments are given the all clear by the OBR tells us little about what a party will do once in government. The OBR itself operates according to a set of assumptions about the maco-economy that are constantly subject to revision and change.

Another problem is that parties and governments that rely on monetary and fiscal rules set by independent bodies are in effect out-sourcing responsibility to these agencies. At the same time, these agencies – fiscal councils, central banks – only operate according to strict mandates set by politicians. The result is that neither the politicians nor the agencies accept the responsibility of making choices that are not right or wrong in any objective sense, but are based rather on what one believes is the right thing to do. This leaves us with a vacuum at the heart of politics. Ed Balls’ idea of auditing his campaign pledges brings that vacuum into the election campaign itself. Far from being a moment where rules are challenged and redrawn, the 2015 campaign risks becoming subject to the same rules and constraints that govern everyday politics today.

A word of advice to Ed Balls? It’s not because the OBR has given your policies the all-clear that voters will trust you. That will only come from building a direct relationship with them and engaging with them as citzens.

Freedom in the Economy 2: Cooperative Control

14 Mar

In a previous post, we defended a universal basic income as a freedom-enhancing economic policy. Such a proposal seems to be of the moment. Peter Frase and Mike Konczal discussed it, built off a post Frase wrote defending a basic income and discussing a convergence between right-wing and left-wing defense of it. Despite the apparent convergence between Left and Right, we suspect a potential divergence is on the surrounding economic conditions (h/t Suresh Naidu on this difference). There are many good things about a universal basic income, but it has its limits. For one, a universal basic income is a lot more freedom enhancing if loads of public goods are already provided – roads, primary education, universal healthcare.

More importantly, a basic income is a good but limited instrument for securing economic freedom in workplace relations. It raises bargaining power, and makes it materially possible to exit work. But the freedom to leave work is not fully guaranteed by a basic income, nor is freedom to leave work all there is to freedom in and at work. Some recent debates between Corey Robin (followed up here) and libertarians, especially Jessica Flanigan at Bleeding Heart Libertarians, and a reminder of a post ‘against jobs’ by Peter Frase, have drawn attention to just this point. It is obvious that having the economic means to leave a job, or at least being able survive for a while without a job, does not remove some of the most significant obstacles to leaving a job. We can use economic language and call these ‘sunk costs’ or simply use common sense and point out that spousal employment, schools for one’s children, family networks, social commitments, expertise and re-training requirements, can all majorly raise the cost of leaving a job. Even on its own terms, a basic income might be insufficient to secure the conditions necessary to allow workers to leave a job, or at least make threats to leave credible enough to put off domineering employers.

But that is not even the most significant point, as it is still a matter of how to think about whether or in what ways we are free to leave a job. The deeper point is that the forms of domination and unfreedom that can exist in an economy are heterogeneous and variegated. A basic income, and the freedom to leave and choose among employments, is a crude way of securing overall economic freedom. After all, though a credible threat a worker makes to leave employment might very well forestall some kinds of abuse, it is something of a nuclear option. If the only way to resist coercion in the workplace is by threatening to leave then it is not all that hard for the employer to call the employee’s bluff, especially when many actual cases of coercion are minor. One suspects that, when the main way of guaranteeing freedom from coercion, abuse and intimidation is by threatening to leave, workplace relations become more antagonistic and conflictual. When all you have is a hammer every problem is a nail. If most problems that arise in the workplace fall below the threshold of needing that hammer, there is little for the worker to fall back on. Unless that worker had voice, not merely exit.

Moreover, even if a basic income can create less unequal bargaining power between employee and employer, it is impossible to write contracts that specify all the relevant conditions. Contracts are inherently incomplete for reasons of imperfect knowledge. A million decisions arise in the workplace itself that could not be predicted. The question then is who should have the rights to control these decisions? These ‘residual rights’ as the economist Oliver Hart called them, can be organized so one person monopolizes them, or they could be distributed more democratically. That is to say, the point is not merely that workers should be free to say what they want, there should be power behind their voices. That is a conventional defense for unions, but onecan take the argument further. It is the idea behind cooperative organization and control of work itself. Workplaces in which the assumption of a labor contract is not that you pick your master, but that you become a co-operator, allow workers to enjoy kinds of freedom that simply are not available if their only option is to stay and serve and employer, or leave and serve a different employer. It is only in this way that each can exercise equal power in the day-to-day structure and operation of the workplace.

A final word in defense of basic income despite its limitations. Workplace cooperatives without a universal basic income would be considerably worse than those when each has a basic income. That is because in cooperatives there will be majorities, not unanimities, and the subtler pressures of public opinion. It is always necessary that any individual be able to leave those conditions. Though one suspects those forces would be weaker, and workers more willing to exercise their control rights against popular opinion, if they enjoy the economic security of a basic income. So if a basic income deals with only one dimension of economic freedom, it is also supportive and supported by other dimensions. All in all, though, there is good reason to think that economic freedom is not exhausted simply by guaranteeing non-coerced contracts. How the workplace is organized, who controls daily decisions, is also its own, distinct question.

Proposals for freedom in the economy: unconditional basic income, cooperative ownership of enterprise, socialized health care.

8 Mar

In a little over a week, one of the editors of this blog, Alex Gourevitch, will be speaking at the Left Forum with Corey Robin and Doug Henwood on a panel on freedom and the economy. The panel is one of three organized under the general theme ‘reclaiming freedom for the left,’ in part inspired by this excellent article by Corey Robin. In anticipation of the panel, we thought we would try out some of the ideas that we will discuss at the Left Forum itself.

The impetus for the economics panel was the economic tendencies of the Occupy happenings, which bounced between anti-Fed, goldbug Ron Paulism and a general attack on corporate personhood. But instead of continue to criticize those economic tendencies, we thought it worth presenting something more positive – not exactly a utopian image of a radically transformed future, but three major economic changes that we believe would significantly increase human freedom. In what follows, we discuss the first: an unconditional basic income.

The idea of an unconditional basic income has floated around policy circles for ages. It has such strange bedfellows as post-Marxist Socialist Andre Gorz, legal theorist Bruce Ackerman, and right-wing crank Charles Murray. It can claim a tradition reaching as far back as Thomas Paine and Thomas Skidmore’s proposals to give all persons a land grant or equivalent value upon reaching adulthood. It is an idea floated at different times by famous socialists like Oscar Lange, left-libertarians like Philippe Van Parijs, and aggressively defended by her Mavericky Maverickness, Sarah Palin.

That’s right, you read that last bit correctly. Lost in the hubbub of the 2008 right-wing debate about whether Obama was a socialists, a fascist, or something worse, was the fact that Sarah Palin, as governor of Alaska, ruled over the only socialist state in the United States. The State of Alaskaowns the major means of production – the Alaskan oil pipeline – and uses the surplus generated from that pipeline to grant, unconditionally, a basic income to all Alaskan citizens. It is called the Alaska Permanent Fund Dividend and as governor, Palin not only happily presided over this economic arrangement, she voted to increase the basic income payout.

A basic income has multiple virtues. Unlike means-tested welfare payments, a basic income is extended to all citizens. This means that the horrible welfare bureaucracy would disappear, replaced by automatic monthly deposits in a bank account. That, in and of itself, would be a gain to human freedom. The USwelfare system can be unbelievably invasive – including unannounced searches of recipient apartments, which get as personal as checking underwear drawers for extra cash, and bathroom sinks for extra toothbrushes (if cohabitating with someone earning an income, you might be cheating the system.) Welfare recipients who need the income are dependent on the state, and must accept this sacrifice of personal freedom for welfare payments. The current welfare system serves more to regulate the poor and to create corrosive distinctions between the deserving  and undeserving poor, rather than deal with poverty itself. A basic income would eliminate that.

A further advantage of a basic income, especially if it were adequately large, would be the reduction of the economic dependence of workers on employers. Those afraid to resist crappy, overbearing, or downright mean employers, would find it much easier to leave a job, or contest conditions at work on equal terms. After all, no matter how ‘fair’ or reasonable a wage-contract is, they are still terms for the sale of one’s labor, and say little about the control one will have over one’s work. The virtue of a basic income is not just that a worker can leave work, but that the added bargaining power makes it harder to walk all over him or her in whatever job the worker happens to find. Here too, the basic income would reduce, if not eliminate, various relations of domination.

A basic income is no magic bullet, but it is more than just an anti-poverty measure. It is the best way to increase the actual and reasonable alternatives of most people, and thus their real freedom.

Behind Europe’s employment figures

6 Jan

Recent unemployment figures released by the German and Spanish governments have bolstered the idea of a two-speed Europe. In Germany, unemployment has fallen to a 20 year low whereas in Spain it has risen relentlessly for the fifth month in a row. In Germany, there are 2.976 million people actively seeking work. In Spain, the number of jobseekers has risen to 4.42 million. Spain’s population, at 46 million, is only a little over half that of Germany’s 81 million. And yet there are almost twice as many unemployed in Spain. As a proportion of the population, German unemployment stands at 6.8% where as in Spain the rate is just below 23%.

As with the trade figures, where repeated deficits and surpluses consistently divided the Eurozone area, unemployment figures seem to tell a similar story. Those economies with the lowest levels are Germany, Austria, Luxembourg and the Netherlands. The so-called PIGS – Portugal, Ireland, Greece and Spain – have some of the highest unemployment rates.

These figures have bolstered those claiming that tough labour market reforms are the best route out of the Eurozone’s doldrums.This claim is misguided for two reasons.

The first is that the nature of the economic difficulties faced by the German and the Spanish economies are fundamentally different. They may share the same currency but they live in different worlds. For Germany, a more challenging export environment has pushed businesses to make savings in an attempt at managing the downturn. These incremendal responses are evident in the way some employers have exploited the flexible labour market, by making some workers temporarily part-time. In Spain, the experience has been one of a massive bubble followed by a crash. This has been most heavily felt in the construction industry, where a house-building boom has given way to empty, half-finished building projects. Much like in Ireland, there is no soft way out of such a crash. Without the demand for homes, construction workers are laid off. Spanish and German unemployment figures reflect not just different regulatory environments for labour but also fundamentally different national economies.

Secondly, it is far from clear, as already commented upon by The Current Moment, that Germany’s labour market reforms are the best way forward for Spain. Whilst unemployment may be low in these Northern European economies, this is because of much greater flexibility enjoyed by employers. Both Germany and the Netherlands have a very high proportion of contracted workers i.e. workers on fixed contracts that have to be renewed every 6 or 12 months. German businesses have also used various strategies – such as a reduction in working hours agreed upon by managers and workers, known as the Kurzarbeit scheme – aimed at maintaining employment levels whilst introducing savings on labour costs for businesses.

Rather than reinforcing stereotypes about successful Northern European economies and failed Southern Mediterranean economies, these figures should push to think about our goals are when we speak about employment. Is it better to maintain employment levels at all costs or should we also think about the quality of the job and the nature of the employment contract? To rely on contracted workers may provide employers with the flexility to cut working hours or shed labour when necessary and helps them escape costly social charges associated with granting indefinite contracts to workers. But if the value of work is to be judged by its connection to an idea of individual self-realisation, then the nature of the job matters enormously. The reliance on contracted labour reduces the incentive for the employer to invest in its staff. The subjective experience of overcoming difficulties, improving oneself and acquiring new skills – all of what produces the connection between work and an individual sense of freedom – is limited by more flexible kinds of working contract.

For employers, there is a downside to individuals realizing themselves through work. More confident and assertive workers are likely to be more militant and more likely to contest the authority of employers and seek better conditions and higher wages. As we have noted before, this fact help explains why jobs programmes as a way of boosting a recession-hit economy are not popular amongst many businesses and politicians. The nature of employment is therefore also a political matter, one that mediates the relationship between workers and business and that – over the medium to long term – goes a long way to shape the kind of society we live in. In the discussion about employment levels in Europe and beyond, what is important is not just jobs for all but also the kind of work that maintains a relationship between labour and freedom.

Debt and Coercion

17 Nov

Among the Solonic reforms that made Athens democratic was the abolition of debt-bondage. In his history of Rome, Livy wrote that the Lex Poetelia of 326 BC, abolishing debt-bondage was “the dawn, as it were, of a new era of liberty for the plebs.” It is probably no accident that Nietzsche, classical philologist that he was, took the connection between debt and subjection to its radical conclusion. Nietzsche thought the notion of moral agency underlying modern life was servile, and that this servility was revealed in the basic idea that morality is keeping one’s promises. For Nietzsche, this subjection of our future selves to promises we make today had its origins in the institution of debt. We don’t have to be Nietzscheans to think the the practice and institutions surrounding debt raises major questions regarding freedom and subjection, and these are issues that have arisen in a major way since the credit crunch of 2008.

Recently, we suggested at least one way in which the use of debt imposes an undesirable discipline on people. When debt becomes the way to gain access to basic goods it forces downwards the expectations and narrows the horizons of debtors. Our main example was the the discipline that student debt places on their subsequent educational and professional choices – they will be less willing to take risks on interesting classes, career choices with riskier or longer-term chances of having a payoff, or that are simply lower-paying. We should have added that having to take debt adds discipline on top of already existing compulsion. Since most people are forced to sell their labor in order to learn their living, it is an added, unjust imposition to say they must finance their consumption with debt burdens they have little chance of being able fully to payoff.

Over at Rortybomb, Mike Konczal reminded us of a number of other ways in which debt is connected to coercion, using what we might initially think is an odd source: corporate finance. Konczal’s post has a bunch of insights, but there was one that caught our eye in particular. Quoting another scholar, Konczal observes that

“Under financial distress, but in the absence of liquidation, the nonrepayment of debt puts the creditors in the driver’s seat. Roughly speaking, creditors acquire control rights over the firm.  They need not formally acquire such rights.  But they hold another crucial right: that of forcing the firm into bankruptcy.  This threat indirectly gives them some control over the firm’s policies…”

Where we had discussed the disciplining effects of debt on individual’s choices, Mike reminds us of the obvious, background threat of coercion. The threat is not just of coercive enforcement of debt contracts by the state, but of handing to creditors coercive control over debtors themselves when they fail to pay up. In the case of the firm this all sounds somewhat benign because a corporate person is not a real person. In fact, in some sense, corporations can be made slaves of their creditors in ways that real persons cannot (which is incidentally another implication of corporate personhood.) Now the disanalogy between corporations and persons here regarding who can be made slaves is less relevant than the analogy. The relevant analogy here is the way the law is structured to permit or limit the kinds of coercion that can and cannot be applied. In other words, underlying all of this is a question of who controls the state (or whatever apparatus it is that enforces debt contracts). That is in fact the lesson of ancient history – when the people acquired political power, they limited the kinds of power that creditors could legitimately exercise over individual debtors. It is also a lesson of the present, as the struggle over whose claims will win out continues apace.

On the flip side, creditors are always angling for the ability to increase their control rights over debtors in the case of default. After all, what they want is a risk-free rate of return. Having a right to control the debtor in the absence of the debtor’s ability to pay is a way of grabbing hold of the value stream from the other end – not the debtor’s earnings, but his or her labor power itself. While formal debt-slavery is obviously illegal, and debtors prisons are (with creeping exceptions) banned, the recourse powers of creditors like suspending time limits on debt or ability to garnish wages and seize other assets are all similar raise similar questions about the kinds of coercion we are or are not willing to allow creditors to have over debtors. For example, when it comes to student loans, the state has made it possible to garnish funds from Social Security checks, and there is time period after which unpaid student loans are discharged, these loans stay with you for life. That means a person with student debt can be placed in a kind of debt-bondage – a life of permanently paying off a debtor.

To be clear, the issue is not the ex post one of whether debts should be forgiven or modified in certain conditions – that is a separate though related question. Rather, it is about the ex ante legally enforceable powers granted to creditors that are part of the contract itself. And the thought is that there are some kinds of coercion that might be incompatible with a democratic society – that is in some sense the point with which the demos and plebs were concerned with. No free society allows that kind of servitude to exist, no matter the promises they made.

Importantly, reducing the kinds of coercive control rights of creditors over debtors would not be any kind of threat to contracts. It would simply be risk-shifting. As mentioned, creditors always want what they can’t have – risk-free investments with high rates of return. The risk-free part is secured by increasing the kinds of control that can be exercised over debtors who miss payments. Taking away that kind of control defends some freedoms of debtors by forcing creditors to accept more risk.

Debt is not always a source of unfreedom. It is, or can be, enabling too. Economics textbooks like to point out that debt helps smooth out consumption. We borrow against future earnings to consume more now. As the FT recently had it “debt is thus a hugely efficient wealth distribution mechanism.” Of course, it isn’t that if what we are doing is substituting for lack of earnings (our point about the debt-based social model) rather than borrowing against future earnings. But even so, it isn’t just consumption choices that debt opens up. Taking a bet on the future is what makes possible innovations and long-term collective economic projects. The human potential that is set in motion when a company decides to make a new airplane is immense – from scientific research to basic manufacturing to industrial design. But we would not be free to engage in these enterprises if we could not take a bet on the future. Companies have to take out major debts to engage in the decade(s) long development of such products. The problem is not so much the taking out of these debts, but the way the laws are structured regarding access to credit, control of companies, who benefits from success, and who suffers from failure. That is true of corporate debt just as it is true of household debt. Yet the general point is still valid – even in a very different, more egalitarian and free society, making bets on our future productivity would open up present possibilities and make possible collective economic action that would otherwise be impossible.

The problem as we see it is that the structure of our economic life maximizes the coercive aspects of indebtedness relative to its emancipating aspects. And most of that has to do with the actual laws surrounding debt, as well as the radically unequal economic power of different market participants. In other words, it is a political question of who controls the state.

Debt, Rights and Social Goods

1 Nov

We have been living in a society where debts, rather than rights, have been the major means for accessing basic social goods. There is now, to a degree, some resistance to this social model. Debt burdens have been a major theme of the Occupations; various state Attorneys-General have grown spines and started investigating foreclosure fraud; and Yves Smith posted a class-action filing by shareholders in Lender Processing Services, one of the worst. When coupled with the work of anti-foreclosure organizations, this amounts to a growing awareness of the problems with debt-financed access to basic social goods like housing and education. And it may lead to alternative ways of thinking about how we win access to these goods.

After all, while the previous decade has been represented as a debt-financed spending binge, when consumers lived well-beyond their means, this turns a complex story into a morality play. A major part of the credit binge was about how people get access to housing and education. Sub-prime mortgages (especially with the decline of affordable housing) were the only way for many to gain access to a home. Student loans were the only for many to gain access to higher education, and thus participate as equals in the radically unequal distribution of opportunity in theUnited States. Mike Konczal posted the following graph at Rortybomb showing the dramatic rise of student debt. In a decade, student loans have gone from a third the number of home loans to nearly equal.

If there is a reasonable expectation that debtors can meet their interest payments then in theory debt is not a particularly bad way to finance access to certain goods. It is on the individual borrower to make a judgement about reasonable debt burdens to take on.

There are, however, two problems with this. First, there might be very good social reasons to not want to yoke access to certain social goods to debt. Education is a prime example. Taking on debt means taking on a kind of discipline. One must make all future calculations about, say, educational and career choices, with the need to meet future interest payments in mind. In conscious and unconscious ways, this narrows horizons and produces a more instrumental relationship to education. We saw many of our college classmates make more conservative professional choices (corporate law, consulting, finance, medical specialist) than they might otherwise have made (public service, teaching, science, labor and public interest law) in order to ensure their ability to pay back loans.

Many have talked about how the growth of finance sucked the math and physics geniuses, who might have contributed something lasting to society, into hedge funds and investment banks. But the alteration of professional choices was much wider than that. The number crunchers at the top were, one suspects, simply lured by lucrative pay. The much more widespread, and difficult to measure, shift in career choices due to the discipline of debt burdens is probably the more important, and still ongoing, effect. If, on the other hand, access to higher education were on the other order of something like a right – a publicly financed good, provided at little or no cost, on the grounds of real equality of opportunity – then one can imagine a much different set of results. While conservatives like to talk about ‘freedom,’ this is a place where the Left ought to have the upper hand in connecting economic practices to real freedoms. Providing necessary social goods, especially education, as a right rather than through debt-financing not only reduces the disciplinary effects of the latter, it also is a way of publicly recognizing and democratically defending the real freedoms of all citizens. To be clear, this is not a moralistic criticism of debt as evil or irresponsible. It is that there might be very good reasons why society would not want to impose certain kinds of discipline on (most of) its citizens, not just because there is good reason to want them to have real equality of opportunity, but also because, simply from a social point of view, its members talents might be much more productively used in some other area than those that promise the most immediate monetary returns.

A second reason why providing social goods like housing and education through debt is a bad idea is that practice does not resemble theory. Again, the theory is that so long as each individual makes a reasonable calculation about ability to meet debt payments, there is nothing wrong with financing access to basic social goods through credit. Putting systematic fraud to one side (but remembering it is unlikely that credit can sink that far into housing and educational markets without it), there is a deep historical reason for thinking that practice was the opposite of theory. The rise of debt-financed household consumption generally was the product of stagnating wages. Consider, for instance, the rise in consumer debt-payments relative to savings.

And compare that with the fate of median real earnings during that same period:

Debt-financed consumption, was, in other words, a response to the declining ability of most households to afford consumption levels, not an increasing ability to or trust in future ability to finance debt-payments.

The entire social model, then, of offering homes, education, cars not to mention ‘non-necessities’ was built on a lie. The separation of consumption (financed by future promises to pay) from production (based on limiting present ability to earn) was a mirage. In a different kind of society, it is conceivable that one might separate a worker’s contribution in terms of effort from the amount of consuming he or she might do. But not in this one. The problem is, in this one, the underlying right to maintain a certain standard of living, or more minimally, to maintain access to certain basic social goods like housing and education, was just that: implicit. Every so often, of course, it was made somewhat public, for instance when Clinton or Bush would say something about providing housing to the poor and minorities who could not otherwise afford it (mainly by changing market incentives, and promoting sub-prime borrowing, as it turned out). But this promise was always implicit, and had to stay that way, because it was mediated through the credit system. It was never a public claim each individual had against society, in virtue of his or her needs and freedoms. Instead, access to these social goods was a matter of a complex series of private, individualized claims against other private persons and institutions like banks and employers. That is the difference between debt and right, and it is clear that the debt-based social model has failed.

To be clear, this is not some moralistic rejection of debt, or a claim that society needs to learn to live within its means. There are some situations where debt-financing is a perfectly good option – the calls for more austerity at present, for instance, is ideological claptrap. Moreover, any economy always has to take a bet on the future if it is going to innovate, and take the risk that innovations will fail. But there are certain kinds of goods that are better provided as a matter of right, both for the sake of the freedom of the persons who need those goods, and as a matter of fairness in how they are provided.

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