The recent revival of radical free-market economics in the United States has puzzled many observers. Jennifer Burns is good on this
The crash of 2008 has recalibrated the balance of power between market fundamentalists and religious fundamentalists in the Republican Party and what we are now seeing is the rebirth of a potent strain of pro-capitalist, anti-statist thought. This aspect of the right has always perplexed liberals, and few expected its return in the wake of a crisis that did much to discredit free-market economics. And yet libertarianism has surged (and religious and cultural conservatism has faltered) as the economy has pushed economics back to the forefront of the policy agenda…Nowhere is this clearer than in these pundits’ embrace of Ayn Rand, one of Greenspan’s mentors, who was for decades banished to the fringes of conservatism. Now she is a staple of Limbaugh’s monologues and her books are one of Beck’s favorite props. Liberals have always scoffed at Rand’s melodramatic novels and her overdrawn contrasts between good and evil. But Limbaugh now hails her as a prophet, and at the tea parties that swept the nation last spring, protesters waved signs that read: “Ayn Rand was right” and “Read Atlas Shrugged before it happens.”
American liberals have tended to believe in the existence of natural left-wing majority on economic issues that contends with the popular appeal of social conservatism. Here Herbert Hovenkamp is accurate, he argues that there were two traditions of classical political economy, a ‘natural law’ group and a ‘utilitarian’ group. Adam Smith represents the former, David Ricardo the later. This is the paradox of Adam Smith, on one hand he was a more humane and insightful man than many of his his later followers, yet his emphasis on the market as a moral system inspires the contemporary right. The early utilitarians could be stigmatized as the gradgrinds of Hard Times but their underlying methodology could be turned to the left. Tea-Partiers have never heard of Pareto equilibrium but they believe that an imagined untrammeled market will reflect their particular view of moral desert, their bad faith is obvious. John Anderson, former leader of the National Party, was a more honest conservative:
We hold the poorest seats in the country and we have to treat them in a caring and delicate way – provide them with services and facilities they otherwise would not have…[we support] economic reforms that will bring national wealth and employment to the highest levels, but then to redistribute some of those gains to the people and communities who might miss out. And its imperative we do this because rural communities contribute more than they are rewarded for
Unfortunately John Anderson’s type of conservatism is in decline.