Chris, Peter and Squeers,

I came across this article (adapted from a lecture) by Tony Judt on social democracy - worth a read, I think.
http://www.nybooks.com/articles/archives/2009/dec/17/what-is-living-and-what-is-dead-in-social-democrac/

It's hard to go past Squeers' assertion that capitalism has flourished and only survives with the provision of adequate social welfare mechanisms

Many thanks, Poirot, for the link to that splendid essay. I have Judt's "Postwar" and am a big fan. It's hard to argue with his moderate stance and I agree that perfection and utopias are unattainable. There are other problematic implications that Judt doesn't mention, however, the prime one being consumerism, the commodification of culture, that Keynes helped to institute and which has demeaned human life; there must be a better way than industry geared to nurture, adapt-to and exploit every passing fancy that idleness can conceive.
But the prime problem, for the whole, remains the raison d'etra of unlimited profit and the unsustainabity of the endless economic growth it demands.
In my view the only hope for democratic socialism is that it impose a wealth cap on every individual, notwithstanding that s/he might own a zillion dollar industry. There should not merely be a wealth cap, but also a luxury cap. There should be no private jets or palaces or any other outrageous luxuries that do nothing to improve quality of life and are merely primitive expressions of superiority. I'm not saying no to wealth and luxury, but there should be limits and moderation in all things. I'm not suggesting, therefore, a new age of puritanism--I like my creature comforts--just that we live sustainably and salubriously. That is, stop worshipping Mammon, putting obscene wealth on a pedestal, as if it were the ultimate goal in life. This is in fact the tacit ideology with which we infuse the sensibilities of every succeeding generation and ultimately ruin their lives. We may individually profess one or the other of the ideologies that run counter to the spirit of capitalism, but these are on the wane, or indeed they're grist for the mill--just something else to commodify. Empty materialism dominates and ultimately we will be judged (by posterity) as a whole and condemned according to the indifferent dictates of nature.

Poirot, yes a good read.

Poirot
We have already seen that Squeers reasoning depends on an underlying circularity.

Furthermore the idea that unregulated capitalism causes economic recessions ignores the fact that government was at all times regulating the price and supply of money. These recessions didn’t arise in the pizza, sock, food or clothing markets which were unregulated. They arose in the financial markets, which government was steering.

Chris
Liberal democracy means a belief in limited government. But you believe that anything government does automatically proves that it is representative of the greater good. You say you have struggled with the issues of public versus private, and no wonder, because your approach provides no way of distinguishing legitimate from illegitimate, abusive from non-abusive, action of government.

Squeers
Just because A comes before B, doesn’t prove that A causes B, does it?

And the alleged free market ideology obviously wasn’t so prevalent as to prevent the founding of the Federal Reserve in 1913, whose function is to do nothing but override the market pricing of money, and thus to take over the steering mechanism of the financial markets.

Your citing of a socialist historian to prove economic propositions is really funny, keep it up.

What you’re not understanding is this. If government inflates the money supply, we will get an artificial boom, followed by a bust, slump, recession, depression, whatever you want to call it. This has got nothing to do with ideology. We could have a Catholic, a libertarian, a communist, or a Calathumpian ideology, we could have an ideology – like Keynes’s and yours – that credit expansion works the miracle of making bread out of stones – and we will still have the same result.

All
I have shown that your beliefs are based on logical fallacies or factual falsehoods, which you cannot defend, or refute my proofs, or show in what circumstances your beliefs would be proved false.

Thus the deep structure of your beliefs is no different than belief in the Tooth Fairy.

"It is curious that people tend to regard government as a
quasi-divine, selfless, Santa Claus organization. Government
was constructed neither for ability nor for the exercise of loving
care; government was built for the use of force and for necessarily
demagogic appeals for votes...It is absurd to say that they will be
served better by a coercive, demagogic apparatus."
Rothbard “Man, Economy and State” at 1302
http://mises.org/books/mespm.pdf

Peter,

Of course govts are not perfect. I do not think any sane observer would think otherwise. After all, they are made up of ordinary men and women. That is why we have elections, courts, oppositions, and so on, to keep them accountable