Economist Bryan Caplan has an interesting post outlining six types of libertarian arguments against government action – “six stages of libertarian denial,” as he calls it:
Libertarians set themselves apart from other political thinkers by habitually denying that government should do things. Denial is therefore at the heart of libertarian thought. Thanks to pop psychology, unfortunately, “denial” has come to mean “refusing to admit the truth” rather than “refusing to admit what others claim.” But denial is still a concept worth holding onto.....
Playing off of pop psychology, I find it most useful to think about six stages of libertarian denial.
Stage 1: Deny the problem exists. Ex: When someone complains about Chinese imports, the libertarian says, “What’s the problem? They’re selling us cheap stuff.”
Stage 2: Blame the problem on the government. Ex: “Sure, Third World poverty is terrible. But without their governments’ statist economic policies – and our immigration restrictions – they’d already be rich.”
Stage 3: Admit that the government didn’t cause the problem, but insist that government action would only make the problem worse. Ex: Opposing price controls for grain after a severe drought. “The market is making the best out of a terrible situation. You’re going to destroy the incentives that will get us out of this disaster.”
Stage 4: Concede that government action wouldn’t make the problem worse, but say that the cure is so expensive that we’re better off just living with the problem. Ex: Opposing handicap accessibility regulations. “It’s going to cost 1% of GDP. For that price, we could give every handicapped person three full-time helpers.”
Stage 5: Admit that government action could solve a problem at a low cost, but claim that the libertarian principle is more important.” Ex: “Freedom means tolerating the very views that you find most abhorrent – even Satanism.”
Stage 6: Yield on libertarian principle, but try to minimize the deviation. Ex: “Yes, government has to supply some roads. But we can still fund them with user fees, not taxes.”
I suspect that what sets me apart from the typical libertarian is that I lean especially heavily on Stage 1....
Bryan’s classification scheme strikes me as a good one. He doesn’t explicitly include slippery slope arguments (“Government Action A isn’t terrible in itself, but it will lead to B, C, and D, which are much worse”). But they arguably come under Bryan’s Category 4; the cost of a government policy includes not only its immediate impact but that of future policies that it renders inevitable or significantly more likely.
Note that Category 2 arguments (“government caused the problem”) don’t by themselves prove that government action is undesirable. The fact that the government caused Problem X does not prove that it shouldn’t try to solve the problem it created. In some cases, one could even claim that the fact that government caused the problem strengthens the case for a government solution (e.g. – “government played a big role in causing the problem of black poverty by promoting slavery and segregation. Therefore, it’s only fair that government enact affirmative action programs to compensate blacks for the wrongs it inflicted on them.”). Thus, Category 2 arguments need to be paired with subsidiary points showing either 1) removing the government policy that caused the problem will solve it, or 2) any politically feasible government effort to solve it will cause more harm than good.
Most of my own libertarian-related work comes under Bryan’s Categories 2, 3, and 4. However, I think he is right to emphasize the importance of Category 1. Some of the most harmful government policies are enacted in response to non-problems. One important category of such are economic regulations enacted to inhibit market competition that lowers prices, improves quality, or make goods and services available to more people. Bryan’s example of protectionism is one of the better-known cases in point, but there are many other examples, such as anti-usury laws (which make it difficult to extend credit to the poor and small businesses).
An even more harmful set of Category 1 policies is that of various nationalist policies based on the mistaken notion that the economy is a zero-sum game in which one nation or ethnic group can only gain at the expense of others. This idea was at the heart of Nazi economic and foreign policy. But less extreme versions of it often crop up on both the left and the right.