Obama: "Left-Libertarian"?

Until very recently, I had assessed Barack Obama as an essentially Keynesian, Bill Clinton-style moderate-liberal on economic questions. Without a doubt, his statements do echo many of the core themes of the "Third Way" popularized in the 90s by Clinton. This view sees free markets as fundamentally good, and as essential to prosperity and progress. However, it also sees an active government as necessary to "tame" capitalism by increasing fairness, stability, and general welfare. I still think this captures much of what Obama has said about economics, but it seems Obama's economics may also have a more original, libertarian side than the moderate-Democratic "Third Way".

On the one hand, Obama has made statements praising classic New Deal welfare programs that are fundamentally hostile to free markets and economic liberty (for example, see this Obama speech at Cooper Union). On the other hand, a number of libertarians seem to be pleasantly surprised with Obama's voluntarist and laissez-faire leanings. For example, Obama and his lead economic advisor Austin Goolsbee have come up with some interesting and quite libertarian approaches to questions such as income equality that have usually been answered with the heavy hand of un-libertarian state programs. Among these are Goolsbee/Obama's emphasis on access to higher education as a means of decreasing poverty, and their embrace of economic globalization.

While Obama is still more a Democrat than a libertarian, his economic views are very refreshing when viewed next to those of Hillary Clinton. It seems Clinton makes a point of always championing the least libertarian means of achieving any goal. For example, she has used misinterpretations of the work of economist Paul Samuelson to justify isolationist criticisms of international trade, outsourcing, and other hallmarks of globalizing economic progress. She even went so far as to question the validity of comparative advantage -- one of the most basic economic principles stating that countries can benefit from trade by specializing in certain areas of production -- relying on a shamefully ignorant view of economics. Clinton's silly economic views have already gotten her in trouble with European nations who fear her economic isolationism could hurt both American and European economies.

There is some disagreement among libertarians regarding Obama's libertarian credentials, but blogger Nick Bradley summed up the issue quite well:

"Obama does offer a few market-friendly programs, such as increased child care and education tax credits (which Paul also supports), exempt payroll taxes from the first $6,500 of earned income, exempt seniors making under $50,000 from income taxes, supports clean coal (most democrats despise hydrocarbon energy production in general), supports carbon sequestration (more market-friendly than carbon regulation), limits agricultural subsidies to farms earning under $250,000 a year, will reinstate PAYGO, has pledged to get all troops out of Iraq within 16 months, opposes war with Iran, and supports the Genocide Intervention Network, which uses private money and nonstate social action to stymie genocide. [...]

In the grand scheme of things, Obama is far less statist than Hillary (socialism at home, hegemony abroad) and McCain (fascism at home, endless warfare abroad)."

It will be very interesting to see how other libertarians compare Obama and McCain as the elections draw near. For now, I'll leave you with Obama's own summation of his economic views, from the speech at Cooper Union referenced above:

"I do not believe that government should stand in the way of innovation, or turn back the clock on an older era of regulation. But I do believe that government has a role to play in advancing our common prosperity by providing stable macroeconomic and financial conditions for sustained growth, by demanding transparency, and by ensuring fair competition in the marketplace. Our history should give us confidence that we don't have to choose between an oppressive, government-run economy and a chaotic unforgiving capitalism."