Modern Reform Movements (circa 1995)
From The Western Democratic Tradition by LJM Cooray

The reformists of earlier times made sacrifices of blood, tears, toil and sweat. But the so-called reformists of the twentieth century take the easy way out. They make no sacrifices. They retain comfortable lifestyles and ask the government to act. They are generous with the use of other people's wealth expropriated through taxation. Some advocates of reform benefit when the government acts to implement reform and a bureaucracy is set up. They can obtain a position with a comfortable salary, a lucrative consultancy or a research grant.

Perhaps the most powerful factor motivating some reformists is envy of wealth and achievement. Envy of those who are achieving and doing better. This envy operates even with a person on a $100,000 a year income or even a $200,000 a year income. They are envious of billionaire tycoons like Murdoch and Packer. This is an important factor in the make up of many coercive utopians. The envy of wealth and achievement is a very important factor, though many of them will immediately deny it if confronted with the issue.

They are very seldom confronted with the issue. The characteristic of the reformists is their unrealistic analysis of human problems. They ignore the experience of history and human nature. Academic analyses of human problems are becoming more and more abstract and divorced from the realities of history and human nature. The dimension which the coercive utopians miss is that a better world requires better human beings. It is not possible to make people better or law abiding or richer by laws and regulations. They focus on structures. Their emphasis on regulation is an emphasis always on changing the structures. Their belief is that if the structures and institutions are changed human beings will change. Capitalism and business are made the scapegoats for every problem. The fact that in pre-capitalist and primitive societies human beings are not much different if ignored.

The values and institutions of the western democratic order contain internal mechanisms for renewal, reform and change. But the mechanisms are ignored by reformists who want to use the power of government and the bureaucracy to effect change. In the process the opportunity for evolutionary change and reform has been lost. The proper bases for and context within which reform and change should be effected are analysed in From Bondage to Freedom 5.4, 16, 18.5 and 26. There is another dimension on which the coercive utopians often focus. They argue that modern conditions demand change. True. But the changes desired by many (so called) reformists are counter productive for reasons stated below and also in many parts of this publication. They consequently confuse modernisation with social engineering. Social engineering packages are passed off to the public as modernisation.

The English common law which is basic to the original tradition in US and UK and countries settled by UK, was developed in relation to the practical problems and experiences of human beings on a case by case situation in a pragmatic fashion. The law was developed in the context of real situations and problems. This is in direct contrast to the modern reform process. Reformists operate, divorced from real life situations, sometimes in ivory towers conjuring up solutions for human problems, without an understanding of human nature and human life. The reformists are much more divorced from the realities of life than the common law judges. The common law judges were compelled to deliver their judgements based on community standards in the light of real human situations and problems. Common law provided for the changes which took place.

The values and institutions of the western democratic order have provided for change. It requires repetition that it is in the context of freedom that change takes place. The "reformist" bureaucracies are not generating change. They are causing stagnation and even regression. This is not to deny that there must be change and reform. Modernism brings its problems. But the problems must be looked at in the light of the accumulated wisdom and the foolishness of the ages. Frequent tampering with the rules by over-ambitious reformists endangers the whole development that began with the renaissance and received a new lease of life from the industrial revolution.

The extent of government control of the economy has in the last 30 years increased from 28% to 43%. See From Bondage to Freedom, section 26. Government regulations affect every aspect of life. Government regulations are drafted by human beings and human beings have their imperfections and fallibilities. The growth of bureaucratisation and government has put the whole system into reverse. This has been discernible from the 1960's. It has strangled the relative freedom that has been responsible for the growth of production and that fostered development. There is a correlation between the growth of government and the growth of poverty. This is illustrated by recent studies in America. There is a correlation between increasing government regulation and welfare on the one hand and the increase in the incidence of poverty on the other. There is a correlation between the growth of government and unemployment (one of the causes of unemployment being the regulation and taxation of business which big government imposes). There is a correlation between the decline of family and religion and the rise of problems relating to drugs and crime, particularly amongst young people. There is a correlation between freedom and limited government and reduction of inequality and progress.

The reformists do focus on genuine problems, injustices and inequalities. They have made a contribution to the establishment of equality of opportunity, in the context of their concern for the underprivileged and the disabled. However, the problem today is that they exaggerate and distort such problems and they get away with these approaches because the challenge and counter arguments are very weak. Their solutions are not infrequently impractical, utopian and counter productive. It is the counter productive aspects of reforms which must be highlighted. By trying to achieve too much through over regulation and over taxation, they miss out on the practical and constructive reforms which can be effected. The words "counter productive" emphasise that, whilst the reforms may yield certain benefits, they are counter-balanced and over-balanced by the disadvantages which are not foreseen or, if foreseen, are brushed aside when the reforms are drafted. They become visible when the reforms are implemented but the counter productive aspects of reforms are seldom properly highlighted.

An example would be the vast sums of money spent on aboriginal welfare, a very small part of which actually reaches the intended beneficiaries. The major part of the money is being creamed off by bureaucrats, academics, researchers, social workers and by persons of mixed white and aboriginal parentage who have few or limited contacts with the life and culture of aborigines.

The basic problems are compounded by a demanding populace and pressure groups who want just about everything. These groups are encouraged by activists and politicians. Individuals and groups (radical and conservative alike) make increasing demands on government and employers, without considering the overall implications - from where will the government get the funds? What will be the effects of more taxation on individuals and business? What will be the effects of higher wages on profitability of business enterprises and levels of employment?

The path of the twentieth century reformer in western democracies is a relatively easy one. They produce academic statements arguing the case for reform. They attempt in various ways to persuade the government and bureaucracy to effect change through legislative action and establish administration and/or judicial institutions. The reform process involves little or no sacrifice for the former. They may even profit in that the creation of the proposed reform, involves administrative machinery, which provides opportunities for jobs for the people who authored or supported the reforms.

The critical spirit has spawned analyses of human situations. From it has sprung the naive belief that where there is a problem there is a solution and the machinery for implementing the solution is government money plus bureaucratic regulation. A great deal is said about the supposed crisis of capitalism. But capitalism has, in the sense of free enterprise, died long ago in the over regulated economies of so-called capitalist countries. The real crisis is of the mixed economy, with too many government inputs, excessive welfarism, juvenile ideas of justice and equality and the weakening of free enterprise, which is slowly becoming incapable of supporting the expansion and development that it has engendered in the last one hundred years or so.

The reformists argue that a contrary approach to theirs overlooks human need. The answer is that those who are advocating unrealistic levels of expenditure and regulation by government do not realise that, notwithstanding the apparent benefits of such activities and payments, in the long run the recipients and the public are likely to suffer as the productive sectors of the economy become less able to function effectively. The consequence is that the recipients, particularly the poor, end up worse off than they were before. The effects of many reform movements are counter productive. This is not confined to the economic area. The peace movement, children's rights, affirmative action, the attempts to weaken discipline and authority, conservation, attacks against the family, educational reform and anti-hierarchy movements are all examples of critical perspectives which make some genuine points but which when pushed beyond reason and commonsense, have counter productive effects and result in counter productive change.

Milton Friedman said in Preface to William E Simon, A Time for Truth, Sydney (1978) xii):

The view that if there is a problem, if there is something wrong, the way to deal with it is to pass a law, set up a governmental agency (staffed, of course, by the intellectuals urging this solution), and use the police power of the State to correct it, is a superficially appealing view. It is simple, as well as simple-minded, and appeals to our natural impulse to take personal credit for the good things that happen and blame a "devil" for the bad things ... that freedom and competition are far more effective than the visible hand of the bureaucrat is a sophisticated, subtle view which is far harder to get across. It requires thought, not reason, to comprehend. It does not lend itself to ringing phrases, to high-flowered sentiment, to promises to particular people or particular groups. Moreover, the market has no press agents who will trumpet its successes and gloss over its failures; the bureaucracy does.
It is necessary to understand western history and tradition, its achievements and its failures before any type of reform is likely to be successful. Reform movements have proceeded essentially by focusing on existing problems without consideration of the existing advantages. This has been the route to a great deal of counter productive reform. Productive reform must be based on (1) an understanding of and a pride in the achievements of the order and its dynamics, (2) a realistic and common sense awareness of the weaknesses, (3) the wisdom to realise the weaknesses that can be reformed by law and those which cannot and (4) a recognition of the role of education as distinct from regulation.