A dubious recipient of the Presidential Medal of Freedom

Obama has given the Presidential Medal of Freedom to Bill Clinton. To cite the website of the White House:

The Presidential Medal of Freedom is the Nation’s highest civilian honor, presented to individuals who have made especially meritorious contributions to the security or national interests of the United States, to world peace, or to cultural or other significant public or private endeavors.

While Bill Clinton’s efforts for humanitarian aid and other charity work are certainly laudable, I think his actions during his presidency disqualify him for a medal. He is responsible for the Lewinsky scandal: he cheated on his wife and lied under oath. Is this the kind of person who should serve as an example to other Americans and be rewarded with such a prestigious medal?

Oprah Winfrey also received the medal for her philanthropic activities. But what kind of philanthropist wants to buy a handbag for $38.000? So much for humility. A true philanthropist would show more solidarity and make some concessions to their own welfare in order to better the lives of other people. If I would be helping destitute people on one day but reserve my money to buy such expensive luxury goods on the other day, I’d be ashamed of myself.

Public servants versus political appointees

On 1 May Coen Teulings ended his seven year term as the director of the Dutch Bureau for Economic Policy Analysis (Centraal Planbureau in Dutch, abbreviated as CPB). During his tenure he faced criticism for his affiliations with the Dutch Labor Party, which was alleged to have influenced his role as a policy adviser for the government. At his departure he was evaluated positively in the media, which noted that the Labor Party had frequently been critical of the policy advice given by the CPB.

This reminded me of a paper I had written for a course I followed during my master’s programme at Leiden University, Politics of Bureacracy. For my argument I summarily investigated political appointees in the USA. American federal executive officials are nominated by the president and confirmed by the senate.

Political appointees in the USA

When Leon Panetta (Democrat) was appointed as the Director of the Central Intelligence Agency under Obama (Democrat), the appointment raised questions if Obama was trying to politicize the CIA; Panetta had no experience in intelligence work. Allegations of partisanship are not new, as even stronger criticism was aimed at the appointment of Porter Goss (Republican), the Director of Central Intelligence under George Bush (Republican).

Lewis (2009) argues (use this link for a PDF behind a paywall but with decent layout) that these political appointments are made for two reasons. They allow the president to control the bureaucracy, with appointees being more responsive to the wishes of the political leaders than public servants. They are also made for patronage, i.e. to reward the members of the president’s party with lucrative positions. He goes on to explain that too many appointees ultimately hurt the performance and control of federal agencies.

Appointees lack the experience of career public servants and stay for short tenures, impeding long term planning. Lower performance in turn makes the agencies harder to control for the president, for example because they are more likely to make mistakes. On the other hand, as outsiders appointees can also give new energy to agencies. It’s a matter of balancing the ratio of appointees to public servants to get optimal agency performance. The USA evidently has far too many appointees, more than 3.500, as opposed to a number between 100 and 200 for other developed countries.

The situation in the netherlands

While I don’t have exact numbers, I assume the Netherlands is in the latter category too. Our General Intelligence and Security Service (Algemene Inlichtingen en Veiligheidsdienst in Dutch) is led by a career public servant. The CPB would even have a serious credibility problem if it would be led by a political appointee, it is imperative that it is an apolitical organization.

I think the difference between the USA and the Netherlands might partially be explained by our different political culture. We have coalition governments instead of the Democrat-Republican duopoly. Even the Balkenende-III cabinet in which the Labor Party didn’t participate had no problem with appointing a vocal economist with Labor Party sympathies like Coen Teulings as head of the CPB.

What I see as a notable exception to the non-political nature of appointments in the Netherlands is the appointment of Piet Hein Donner (Christian Democrats) as vice-president of the Council of State (Raad van State). The cabinet insisted that the procedure was open, but many opposition figures thought it was a farce and Donner’s appointment was predetermined.

The man surely is an expert in law and seems capable for the job, but the appointment had a semblance of politicization to me as well. Just like the CPB advises on economic policy, the Council of State has an important advisory role on law towards the government. All the more reason to make it just as apolitical as the CPB.

Obama and partisanship

What caught my attention regarding the politics of the USA is the appointment of the Republican Secretaries of Defense Robert Gates and now Chuck Hagel by Obama. This is different from this discussion of the relationship between the public service and politics because a Secretary of State is always a politician, but related to the partisanship issue. Why not reward a Democrat with position? Obama assures us he chose Hagel because all he cares about is having the right person for the job. Some journalists think it really is a clever plan to screw the Republican Party.

Make Open Access publishing mandatory

When I’m writing content for Wikipedia I often use articles from scientific journals as a source. But most of the time these journal articles are not free. For example, if you wish to download an article from the Journal of Public Administration Research and Theory for example, you’ll have to pay $25 to read it for one day. For academics this is not an issue because their university library has subscriptions to those journals, allowing them free access. Many ordinary people however do not.

It frustrates me that in practice they can’t check the scientific sources of statements made on Wikipedia or in other media unless they have deep pockets. Especially if you live in a third world country, scientific knowledge is only available to the rich. This is strange, because the scientists who contribute to and edit for scientific journals don’t get paid for their work by the publishers of those journals. The universities where the scientists are employed are funded by the taxpayer. We pay twice, first for scientists who produce scientific knowledge and then to the publishers to acquire that knowledge.

Why scientific journals charge (high) fees

A detailed explanation can be read here, but I’ll summarize. In the past publication of scientific journals was done by scientist-driven organizations and it was rarely a profitable activity. This changed when the Science Citation Index was started in 1960, which measured how many times journal articles were cited to determine the influence of articles and their authors. This in turn gave rise to the impact factor, the average number of citations of all articles in a journal to determine the influence of that journal. As a consequence scientists started to prefer publishing in the most prestigious journals.

At this point of the story the commercial publishers make their appearance. They saw profit, gradually acquired more and more journals and started charging disproportionate prices for the prestigious journals. The prices for subscriptions increased with 215% from 1986 to 2003, while the inflation rose with merely 68%. In the same period digital distribution became popular, which should have led to a reduction of distribution costs according to common sense. Scientists have agitated against high journal prices, especially those owned by the publisher Elsevier.

Open Access publishing as an alternative

But then the concept of Open Access arose to fight this evil, enabled by the Internet. Open Access publication of scientific articles means that they are freely available and carry no restrictions on their use. It has been estimated that 7,7% of all articles published in peer-reviewed journals were Open Access in 2009. And that rate is still growing. The best example for this is the Public Library of Science (primarily natural sciences).

Open Access has found appeal in the Netherlands too: my own university (Leiden University) and several other organizations collaborate on the Journal of Archaeology in the Low Countries. A professor of Psychology at Leiden University also recognizes the importance of Open Access publishing. In fact, all Dutch universities committed to Open Access when they signed the Berlin Declaration.

But 7,7% still means that the vast majority of scientific knowledge is locked away behind the paywalls of the publishers. Also, the adoption of Open Access publishing in the Netherlands has been stagnating since 2007. One solution which has been proposed to elevate Open Access publishing is to make it mandatory, just like Harvard University and the Massachusetts Institute of Technology have done.

My stance in this

If research is funded by the taxpayer the taxpayer should have the right to access that research freely, anything else is an injustice. If Dutch universities don’t take action by themselves the government should. But since there is no indication that is going to happen anytime soon, the more important question is what I can do.

Right now I’m at the verge of pursuing a scientific career. I’m soliciting for a PhD position at Leiden University and job as a researcher at Erasmus University Rotterdam, both in the field of public administration. It seems like I’m already getting off on the wrong foot, because I submitted an article for review to the aforementioned Journal of Public Administration Research and Theory just a week ago! This is my master thesis, which I’ve rewritten in the form of a shorter, publishable article.

I keep telling myself this is justified because I’m at the beginning of my career and can afford to be picky in where I’ll publish, but I feel like a hypocrite. I don’t really have an excuse, because there are Open Access journals in the field of public administration. They’re not prestigious and I’m not sure what to do with my article – let’s see if it’s accepted for publication first – but if I do land at a job at either university Open Access publishing will be my first priority.

What is a sustainable level of meat consumption?

I already wrote about this topic more than two years ago to state my concerns over the level of meat consumption in the (Western) world. Back then I already explained why it’s detrimental to our environment so I won’t go into detail here. The Wikipedia articles on the environmental impact of meat production and environmental vegetarianism explain it nicely, so read those.

Since then I’ve lowered my consumption of meat, but it was not an issue for my family. They think they don’t eat it much, while I do. Because I wasn’t motivated to make my own vegetarian food when my mother prepared non-vegetarian food for the whole family, I used to eat along.

Recently I changed my behaviour because I thought I was lazy. Being served non-vegetarian food by others was no reason to stray from the virtuous path of sustainable living. This led to some discussion at the dinner table, giving rise to the question: at which quantity is meat consumption sustainable?

Statistics and some assumptions

The Economist has statistics on meat consumption per capita for 2007. In the complete data they also provide the world average, which is 38,7 kilo or 106 gram a day.

I make two premises. The first is that everyone should not consume (much) more than this average. If you look at the statistics you see the developed world consumes a disproportionately high amount of meat while most of the developing world consumes very little. This means the developed world puts the greatest strain on our environment. I don’t think we have more right to burden the environment than the developing world, so what we are doing now is unethical.

The second premise is that no further environmental degradation should occur. If that is what we want, we should not increase our total meat consumption above the 2007 average. However, I’d say that even in 2007 the global environmental damage caused by meat production was already too much, and it needs to be even lower. I’d say an arbitrary number such as 30 kilo a year seems acceptable.

Solutions

Ultimately, reducing meat consumption is not going to happen with a growing world population. At a certain moment meat prices will increase because of supply and demand, but when that happens the environment has probably gone to hell already. I’m sure many people are not as concerned over this issue as I am, so they’re not going to change their behaviour out of their own motivation.

This means government has to intervene. The best solutions would probably be taxing meat (just like we levy an excise tax on petrol in the Netherlands because of its environmental impact) and drastically reducing the world’s population. But if you want to change the world you should take responsibility and start with yourself.

How much do i and my family consume?

According to the statistics the average Dutch person consumed 71,3 kilo meat in 2007. I think my family is probably below this average, so in that regard they are probably right when they say they don’t consume much.But I suspect my family may consume more than the global average of 38,7 kilo.

But this is something which needs to be measured. I will do so by calculating the total weight of all meat products appearing on our supermarket receipts for one month and then extrapolate that to a year. I estimate my own consumption is probably no more than 21 kilo a year (based on 400 gram a week), but this is also something I will measure.

Update 14 February

After measuring the meat consumption of my family for 19 days and extrapolating that to a year, it turns out we consume far less than I expected. I consume 19 kilo a year, the rest of my family 22, 29, 31 and 34 kilo. All far below the average for the Netherlands and below the world average.

Obama’s re-election, Nobel Prize for the EU

I’m glad Obama won the elections instead of Romney, but I see him as merely the lesser of two evils:

  • His administration cracked down on Wikileaks. That was understandable and reasonable to some extent, but pressurizing the financial industry to institute a blockade against them without any legal prosecution went too far.
  • He left/leaves Bradley Manning to rot in jail. While I think some of the information Manning leaked should have remained classified, it was a good thing the video of the July 12, 2007 Baghdad airstrike was leaked. While I assume the shooting of the reporters in the first part is a sad mistake, the attack on the building was in blatant disregard of civilian casualties. That’s why I believe Manning is a whistle blower and should receive a presidential pardon and a medal instead of a prison sentence.
  • Most important of all, he allows drone strikes to kill in Pakistan without regard for civilian collateral casualties.
  • And the Guantanomo Bay detention camp, anyone? That still isn’t closed, even though he promised it when he started his first term.

In other news, the European Union received the Nobel Peace Prize. I’m critical of this because I think that if the EU had not existed, it would not have made much of a difference for the advancement of peace. I have more trust in the democratic peace theory. For example, since democracy has taken a foothold in South America, we haven’t seen any wars there either.

News summary, May 2012

This is a summary of various news which caught my attention during the last month.

Games

  • Valve’s Steam, Left 4 Dead 2 and probably some of their other games will be ported to Linux. This is great news, I love you Valve!
  • CD Projekt RED released a free upgrade to the Enhanced Edition of The Witcher 2 which provides 10 GB (!) of new content. Other developers such as Electronic Arts are run by people who care most about making money, but this developer is run by true artists who want to deliver a great game besides making money.
  • The long-awaited Black Mesa: Source mod is still alive. I was disappointed in the lack of news but recently they have started communicating again. According to an interview (part one and two) the reason for the delay is that they have very high standards for their work and weren’t satisfied with the game yet. I’m looking so much forward to the final product.
  • Another free game made by volunteers is Wing Commander Saga. It has been released recently and looks quite impressive, I haven’t tried it yet.

Hardware

Dell is working on Project Sputnik which aims to produce a laptop for developers. It’s based on Dell’s XPS 13 ultrabook and Ubuntu 12.04. This is great news, because the two companies that I know of which ship notebooks with Linux – System76 and ZaReason – don’t offer ultrabooks. The smallest they have to offer are 14 inch models weighing two kilos. Also, I appreciate the design of the XPS 13 more, the only disadvantages are the glossy screen and the lack of an Ethernet port.

As I wrote on this weblog earlier, under Linux my Acer TravelMate Timeline 8371 initially didn’t have suspend working. It still consumes more power and its fan turns noisy much more frequently than if Windows were used. It would be great if Dell’s laptop would have everything working out of the box. However, I have one important requirement: it should work just as well with other Linux distributions as it does with Ubuntu. That means there should be no special software or drivers tailored to make everything work with the Ubuntu version shipped with the laptop. If they can realize that, count me in.

Software

We have a choice of two open source Linux-based operating systems for smartphones, Android and more recently Tizen (which has not been shipped with any smartphone yet). Fortunately Mozilla has introduced a new contender: Boot to Gecko (B2G). While Android is open source in name, I feel that Google exercises too much control over Android and has become too powerful. I don’t trust them with the personal data they gather from me.

Mozilla on the contrary is a party which I do trust. B2G has more credit for openness and has a great vision behind it which distinguishes it from the competition. Additionally, B2G is far less demanding on the hardware, so it could run on much cheaper smartphones. I can’t wait to get my hands on a smartphone which uses B2G.

Additionally, if you buy an Android phone you contribute to Microsoft’s profit because they are extorting manufacturers of Android smartphones with patent threats. I don’t want to pay for a smartphone if even one cent of the manufacturers income is spent on royalty payments to that immoral company. Motorola, which has been acquired by Google recently, is fighting back. In May Microsoft won a legal case against Motorola because Motorola infringed on one of Microsoft’s patents on generating meeting requests from a mobile phone. Read the parent’s description to see how ridiculous and trivial this patent is. Once again I’m glad we don’t have software patents in the EU.

Politics

  • The Netherlands is the second country in the world to adopt net neutrality. I consider this very important for freedom on the Internet and I praise our politicians who decided to impose it.
  • As I wrote in my second to last post, I was worried that the Dutch People’s Party for Freedom and Democracy isn’t protective enough of freedom and privacy, especially on the net. Thankfully I’ve been proven wrong now that they voted in favor (article in Dutch) of canning ACTA.

Everything is a Remix and politics

Today I watched the fourth and last part of Everything is a Remix. It is a brilliant video series which explains the problems of intellectual property and much more. It is very well made and effective in communicating its message. The fourth part explains how the rules of intellectual property no longer protect the inventions of artists and inventors, but harm the common good. With that statement made, the fourth part ends, without any suggestions on how we could solve the problem. Maybe the creator of the series, Kirby Ferguson, didn’t have a desire to comment on solutions.

Recently we have witnessed the death of SOPA and ACTA being the subject of much criticism. I have already written a post about it on my Dutch weblog. I observed in that post that there are politicians who are willing to take action against these corporate attacks on the public domain. But even then, it seems we are merely defending ourselves and stopping the attack, but we don’t counterattack. While stricter intellectual property legislation may have been averted for now, it is still possible for film studios to cash in for eternity on films under their copyright, even if they are more than half a century old.

But we do have the power to make change happen with our vote. We have the Pirate Parties for example. I have not studied the political program of the Dutch Pirate Party, but if my own party the People’s Party for Freedom and Democracy continues to tread on privacy and other parties don’t do enough I might be tempted to vote for them in protest.

By the way, a much longer documentary film on intellectual property I’d recommend is RiP!: A Remix Manifesto which can be watched here.

Why Obama should not be reelected

It was a bit hard to figure out what Obama did most recently because two articles on my favorite Dutch news website (but other Dutch news outlets are also guilty of this) merely mention that Obama signed ‘a law’. Because the stupid Dutch news didn’t bother to mention which law it concerns I had to do a bit of searching myself, and I figured out that it is the National Defense Authorization Act (NDAA) (you have to love these cool names they give to their laws in the USA, we should have that in the Netherlands too). We already knew that Obama wasn’t living up to his promise to close Guantanamo Bay, but this is the nail in the coffin for the promise, which has been reneged on by Obama completely now. Maybe Obama felt himself cornered by the Republicans when he signed the NDAA, but the idea that he can use discretion in applying the Act to prevent the harm to civil liberties is not at all convincing because the damage has already been done. Sure, the NDAA was necessary because the defense forces need funding, but when these highly objectionable provisions for which you threatened to veto the Act are still in and you sign it ‘with reservations’ you lack spine.

According to the article in The Washington Post funding was going to expire on Monday 2 January, so Obama signed it on Saturday 31 December after last-minute modifications were made by Congress at the request of the White House. Seems to me like they had better done it a few months in advance instead of waiting for the last minute if you ask me, procrastinating is supposed to be something what university students like me do, not presidents. So Obama had his hands tied because the funding was about to expire, but in that case why did you wait so long? Did (Obama allow) the House of Representatives with its Republican majority stonewall the process so they could force Obama’s hand when the deadline for new funding came?

If Obama has so much difficulty with closing Guantanamo, maybe the Cubans can kick the USA off their territory? They would have good reasons to do so. At least Ron Paul (among others, of course) has a mind of his own and realizes the value of civil liberties with his opposition to the NDAA  Unfortunately I find many of his other ideas such as those on abortion, climate change and higher taxes objectionable, so I wouldn’t want him to be the next president.

Yes, of course Obama has also achieved change for the better, such as the Patient Protection and Affordable Care Act (PPACA). But then again, it doesn’t make up for this unforgivable mistake he made with the NDAA. But there’s more. There’s the upcoming Stop Online Piracy Act (SOPA) which is another great danger to freedom, but it’s unlikely Obama would veto it. While Bradley Manning rots in jail, he thinks the treatment he gets is appropriate. He might have the intention to raise taxes for the rich with the Republicans preventing him from doing so, but as I wrote earlier his government is still too friendly towards Wall Street.

Concluding, I think the Democrats and Republicans which have been controlling the government in the USA for such a long time are what we would call “regent’s parties” in the Netherlands. Meaning, they have become so used to governing that they don’t represent the people of the USA properly anymore and care more about their own position. But in the USA it’s much worse than in the Netherlands where some of the parties who were accused of being regent’s parties have been punished by the electorate. Almost half of Congress consists of millionaires who are in the pocket of the special interests. I hope Americans Elect would have the power to break this duopoly of the Democrats and Republicans.

The Royal Wedding and the cost of a monarchy

I realise this post comes quite late after the Royal Wedding has taken place at 29 April, but I was lazy with blogging and I’m clearing my backlog now. When I was in Nepal at the time the event happened I kept in touch with the news and read a lot about the subject. Obviously, prince William and Catherine Middleton do not know the meaning of the word humility. What makes them even more despicable persons is that they expended a lavish amount of money on their wedding at a time when the average Briton has to cope with budget cuts. Many sources give wildly different figures of the cost of the wedding depending on which kinds of expenditure and income are taken into account, for examples see MSNBC,  ABC News, CNN and the Daily Mail.

What is more interesting is that I learned about the British republican organisation Republic when I read the news on the subject. Their website is very convincing, the website of the Dutch Nieuw Republikeins Genootschap looks unimpressive by comparison. The website of Republic gives an interesting rebuttal of common arguments in favour of a monarchy, but most interesting is the section on Royal Finances. One of the most common arguments against a republic is that ‘a president would be just as expensive as a monarchy’. In the past I’ve been trying to find statistics to disprove this argument, but didn’t succeed as that data is difficult to find. Their report does supply this information. It turns out that the Dutch monarchy is one of the most expensive monarchies, even if they’re far behind the United Kingdom. And Ireland has a president which costs them £1,8 million. I do wonder though what their source is for the costs of the Dutch monarchy. I couldn’t find the data in a primary source, but RTL Nieuws reports that our monarchy cost us € 119 million in 2008, which translates to more than £104 million. That’s more than the figure of £88,3 Republic mentions in their report.

The morale of the story is that it doesn’t matter if government is a constitutional monarchy or a republic, both can be as expensive or as cheap as you want. From a Dutch viewpoint, I’d say that while our monarchy isn’t going away any time soon, we could take an example from our Scandinavian and Belgian neighbours. Given that they spend far less on their monarchies, we could subject our monarchy to serious budget cut. But it’s not just about money, even if a republic were more expensive I’d gladly choose it over a monarchy because of democratic principles.

The annual Telders Foundation lecture by Deepak Lal

Over two weeks ago on the 30th of November I visited the annual Telders Foundation lecture. The Telders Foundation is the scientific bureau of a Dutch liberal political party, the People’s Party for Freedom and Democracy. It was conveniently located in the center of Utrecht where it was held in the Nicolaï church, where it started just a moment after my lecture for the course ‘Ideologies in the 19th and 20th century’ I’m following finished. That is a useful coincidence, because the Telders Foundation lecture was given by Deepak Lal, a development economist, who gave a classical liberal perspective on the global economic crisis. Thanks to the course about ideology I’m following I know the details about classical liberalism and social liberalism and other ideologies, so I can place it in perspective.

He explained what the causes, current issues and geopolitical consequences surrounding the global economic crisis are in his opinion. Basically, one of the primary causes were the bailouts of large ‘too big to fail’ companies. Long before the current crisis began LTCM was bailed out in 1998. LTCM was a hedge fund, yet they were still bailed out! He mentions many more examples of privatizing profits and socializing losses such as the Greenspan put. He thinks the promotion of home ownership in the USA was a cause of the crisis, how exactly I don’t remember, but Wikipedia gives an explanation for it too. In general Wikipedia’s article on the global financial crisis of 2007–2010 gives a good impression of what his other ideas are about the causes of the crisis. He argues that all the policy errors created a moral hazard, the bailouts for example created a wrong expectation for the market that the government would intervene in a crisis to save the system. He argues that the financial system has become too complicated and nontransparent, which exacerbated the problems. One of the more interesting causes which I had never heard about before was the abolition of the Glass–Steagall Act, which separated commercial banks from investment banks. Because the latter involves, in his words, ‘gambling’, the undoing of the separation contaminated the part of the financial sector which should not have been prone to the risks of investment banking. According to him the firewall should be maintained so investment banks can be set free.

When discussing the current issues he started introducing a lot of complex economic thought, which I could understand reasonably well but probably dazed others. He introduced Friedrich Hayek and Irving Fisher (I heard of the first economist, but the second was new to me) to give a theoretical perspective. I don’t remember exactly what the line of reasoning was after more than two weeks, but he came to the conclusion that quantitative easing (a complex word which simply means that the supply of money is increased by the government), the policy currently employed by the central banks of the USA the UK and the EU, is right. But quantitative easing needs a timely exit. And the USA has a problem that it’s deficit is rising, Obama’s health care Act is a cause. The UK was right to cut government spending, but wrong to keep it’s VAT rise and it’s 50% income tax rate. The European Central Bank is right to implement quantitative easing whilst demanding to cut government spending. In other words, the welfare state needs to be reduced because it is becoming unsustainable such as in certain places in Europe and the USA which is in denial with it’s expansion of health care insurance.

Regarding the geopolitical consequences of the crisis, it’s interesting he said that China’s share of the USA’s government debt won’t enable them to destroy the USA’s economy at will by selling the debt papers, as many people seem to think. A huge offering of those debt papers would make them worthless because supply would be greater than demand, so China would gain nothing. However, due to the crisis the USA may not be able to keep maintaining global order, which would lead to the erosion of global order which in turn would lead to the erosion of globalization.When Lal finished, Frits Bolkestein (the president of the Telders Foundation and a famous retired VVD-politician both in the Netherlands and Europe) joked that he was sure the audience had understood everything, but that it was now to ask questions. At this point I had to leave to catch my bus.

So what makes this vision on the financial crisis classical liberal? Lal doesn’t think the crisis marks the end of capitalism. The crisis was caused by primarily by wrong government policy. Better regulation is the remedy, if that requirement and others are met the capitalism could work properly without these financial crisis (my assumption he thinks that). There should not be companies which are ‘too big to fail’, and commercial banking and investment banking should be separated  so the latter can’t contaminate the former with it’s risk. But non-interference of the government is also the key, governments shouldn’t bail out failing companies and let the free market take out the rotten apples, the failing companies. Deficits are dangerous and can be solved by cutting government spending, through shrinking the welfare state which is not sustainable at this moment.

Classical liberalism is relative in this age, I doubt anyone calling themselves a classical liberal now would want to return to the night watchman state reminiscent of the first half of the 19th century by the abolition of the welfare state. Back then classical liberals advocated such a minimal state, but nowadays I don’t think they would want to reverse the development completely. I clearly see the distinction with social liberals because Lal didn’t even once mention the unemployment caused by not bailing out certain companies.

While refusing to bail out General Motors would have been right in the sense that GM would have gotten what it deserved – bankruptcy – it would have caused massive unemployment. Social liberals would be far more concerned with preventing unemployment than classical liberals. Also, some of these bailouts are profitable for the government, for example the USA’s government made a profit of 12 billion dollars when it completed the sale of all it’s shares of Citigroup recently. Also, the government imposed strict demands on the companies which were bailed out, such as cuts to bonus payments. If the ridiculous bonus payments have been reduced adequately is different question, but if you can prevent unemployment and can make a profit with bailouts, why would you not do it? I think principles and ideological tunnel vision should not be a barrier.