Hat tip to Ron Chusid for pointing out Daniel Koffler's analysis of Barack Obama's policies as left-libertarian.

Obama's preference for reducing healthcare costs while preserving the freedom to choose whether or not to participate in the healthcare system, as against Clinton's (and Edwards's) insistence on mandating participation, is not a one-off discrepancy without broader implications. Rather, Obama's language of personal choice and incentive is a reflection of the ideas of his lead economic advisor, Austin Goolsbee, a behavioural economist at the University of Chicago, who agrees with the liberal consensus on the need to address concerns such as income inequality, disparate educational opportunities and, of course, disparate access to healthcare, but breaks sharply from liberal orthodoxy on both the causes of these social ills and the optimal strategy for ameliorating them.

Instead of recommending traditional welfare-state liberalism as a solvent for socioeconomic inequalities and dislocations, Goolsbee promotes programmes to essentially democratise the market, protecting and where possible expanding freedom of choice, while simultaneously creating rational, self-interested incentives for individuals to participate in solving collective problems. No wonder, then, that Obama's healthcare plan is specifically designed to give people good reason to buy in, without coercing them. Likewise, as George Will reported in a column from October, Goolsbee's proposal for reducing income inequality is to lower barriers to higher education, the primary factor in determining future earnings, and noticeably does not rely on state interventions in the market, which can succeed at equalising income at the price of reducing it across the board.

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The evidence that Obama heeds Goolsbee's lessons is ample, his healthcare plan being but one of many prominent examples. Whereas Clinton has recently taken to pulling protectionist stunts and rethinking the fundamental theoretical soundness of free trade, and Edwards is behaving like the love child of Huey Long and Pat Buchanan, Obama instinctively supports free trade and grasps the universe of possibilities that globalisation opens up, and seamlessly integrates it into his "audacity of hope" theme. As he remarked in a recent debate: "Globalisation is here, and I don't think Americans are afraid to compete. And we have the goods and the services and the skills and the innovation to compete anywhere in the world."

At the moment, Obama's and Clinton's positions on trade are roughly equivalent - both deserve credit for taking initial steps toward dismantling the obscene US government-supported agricultural cartels - but the present dynamic is Obama moving more and more in the direction of economic freedom, competition and individual choice, and Clinton wavering if not moving away from it. Obama proposes to address the "actuarial gap" in entitlement programs - actuarial gap being a term congenial to if not lifted straight from Niall Ferguson's analysis of generational accounting - in part by raising the cap on payroll taxes, but in part by creating incentives for personal retirement accounts, fostering, if you'll pardon the term, an ownership society. The idea, as with his approach to healthcare, is to bring individual self-interest and collective needs into harmony, and let rationality do the work from there. (Hillary Clinton, in case you're wondering, disagrees.)

Similarly, while Obama's support of immigration and immigrants undoubtedly derives in part from straightforward internationalism and humanitarianism - Obama's lead foreign policy advisor is Samantha Power, author of A Problem from Hell, under whose guidance Obama has directed far more attention to the Darfur genocide than any other candidate - it's likely that part of Obama's embrace of immigration stems from a Goolsbeean view of free movement of labour as inextricable from and essential to a free global market.

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In other words and in short, Obama's slogan, "stand for change", is not a vacuous message of uplift, but a content-laden token of dissent from the old-style liberal orthodoxy on which Clinton and Edwards have been campaigning. At the same time, Obama is not offering a retread of (Bill) Clintonism, Liebermanism, triangulation, neoliberalism, the Third Way or whatever we might wish to call the business-friendly centrism of the 1990s. For all its lofty talk of new paradigms and boundary shifting, the Third Way in practice amounted to taking a little of column A, a little of column B, and marketing the result as something new and innovative. Obama and Goolsbee propose something entirely different - not a triangulation, but a basis for crafting public policy orthogonal to the traditional liberal-conservative axis.

If this approach needs a name, call it left-libertarianism. Advancements in behavioural economics, public and rational choice theory, and game theory provide us with an opportunity to attend to inequality without crippling the economy, enhancing the coercive power of the state, or infringing on personal liberty (at least not to any extent greater than the welfare state already does; and as much as my libertarian friends might wish otherwise, the welfare state isn't going anywhere). The cost - higher marginal tax rates - is real, but eminently justified by the benefits.