Friday, June 15, 2012

Hayek and Liberty

Sheldon Richman posts (15 June) and edits The Freeman HERE
F. A. Hayek’s essay “Individualism: True and False” (pdf; chapter one of Individualism and Economic Order) overflows with insights that belong in any brief on behalf of the free society. As the title suggests, Hayek wished to distinguish two markedly different philosophies associated with the label individualism: one that rejected rationalism and one that embraced it
“One might even say,” Hayek explained, “that the former is a product of an acute consciousness of the limitations of the individual mind which induces an attitude of humility toward the impersonal and anonymous social processes by which individuals help to create things greater than they know, while the latter is the product of an exaggerated belief in the powers of individual reason and a consequent contempt for anything which has not been consciously designed by it or is not fully intelligible to it.”
Thus for Hayek the crucial difference is over whether societies (institutions) are largely spontaneous, emergent, and organic – or designed. His great concern was that rationalistic individualism, in awe of the mind’s ability to engineer solutions, too readily leads to the centralization of power and totalitarianism.
Controversial Essay
This essay has not been without controversy even among fans of Hayek. He has been criticized for drawing too sharp a distinction between the liberal rationalists and liberal empiricists and for being arbitrarily pro-British and anti-French in dividing the true from the false individualists. I happily duck those controversies here and focus instead on points that are both less controversial among liberals and, in my view, indispensable to the full case for freedom. (In his book Classical Liberalism and the Austrian School, the great intellectual historian Ralph Raico criticizes [pdf] Hayek’s derogation of the French liberals. “Some might uncharitably suspect Hayek of a terminal Anglophilia which tended to blind him to some obvious facts,” Raico writes.)
The first point I draw attention to comes in Hayek’s discussion of Adam Smith’s view of mankind. Smith’s “chief concern,” Hayek wrote, was not so much with what man might occasionally achieve when he was at his best but that he should have as little opportunity as possible to do harm when he was at his worst. It would scarcely be too much to claim that the main merit of the individualism which he and his contemporaries advocated is that it is a system under which bad men can do least harm. It is a social system which does not depend for its functioning on our finding good men for running it, or on all men becoming better than they now are, but which makes use of men in all their given variety and complexity, sometimes good and sometimes bad, sometimes intelligent and more often stupid. Their aim was a system under which it should be possible to grant freedom to all, instead of restricting it . . . to “the good and the wise.” 
Keep this in mind the next time someone proclaims that a muscular State, unconstrained by strict rules, is needed to prevent flawed human beings from harming others. Then ask: What will keep the flawed–and privileged–human beings who have access to the violent power of the State from harming others? Those who are familiar with Hayek’s The Road to Serfdom, and especially his chapter “Why the Worst Get on Top,” will know what Hayek is getting at."
I’d love to quote it all but do not wish to trespass on The Freeman’s copyright; an example of refraining from doing harm either because I might get away with it at the risk of harm to the people at The Freeman, or because I recognise that laws protect all from the harm that might be caused by others and therefore should be obeyed, and, where necessary, only changed by due process not willful defiance.
[Follow the link above provided by The Freeman and read it for yourself.] 
I think Sheldon Richman gives an account of the central tenets of a non-threatening libertarianism that I can go along with that is both persuasive and compelling.  A lot of anarchists and libertarians that I know (not always the same people I find) would do well from considering what Hayek’s had to say on these subjects, which is close to Adam Smith’s philosophy.  Hayek puts the state in its place within a libertarian society and protects it from the excesses of those who see States as the enemy, and from the other lot who see the State as an instrument for their particular proposals to ‘design’ a society in their image.
Sheldon puts in their proper place and perspective the ‘rational’ ‘maximisers’ of utility’ theorists that abound in modern economics and who design brilliant images of an economy that does not exist, in which Homo economicus is alive and well.
“What the economists understood for the first time,” Hayek wrote, “was that the market as it had grown up was an effective way of making man take part in a process more complex and extended than he could comprehend and that it was through the market that he was made to contribute ‘to ends which were no part of his purpose’.”
No individual, group of individuals be they ever so brilliant (and well meaning), or any collective of Government Ministers, know or can know enough about and economy to run such a complex social structure.  Those who think they can are deluded.  So are those who vote for them in the belief that they can acquire and apply such knowledge, are those who engage in civil disorder and violence in the belief that the outcome will improve the world. 
The world changed from the long 200,000 years of permanent subsistence for the many and better than subsistence for rulers (for as long as they held onto power) up to the great revolution in the gradual spread of markets from the 17th- 18th century from North Western Europe (especially Holland and England) without anybody noticing, without imperial decrees, without Devine guidance, without a single manifesto, without a single prophet, or Great Leader, or a mass movement of proselytisers, and not even a visionary founder.
That part of the world that quietly adopted what had begun, amidst all the hustle and bustle of High Society vanity and place, who wasted millions on wars and people in genocides across the globe, which adoptees slowly and gradually discovered the power of individual drive, innovation, and enterprise, that changed the old, subsistence dependence in favour of rising per capita incomes for masses of people, into what we call development through discovering economic growth, technology, division of labour, and personal liberties.  Those societies (China, particularly, but also many others) than discovered so much technology in anticipation of what was to follow, failed to carry their early start from the absence of liberty.

[I recommend to readers of Lost Legacy that they read Deirdre McCloksey’s “Bourgeois Dignity: why economics cannot explain the modern world”, Chicago, 2011, as well the rest of Sheldon Richman’s post in The Freeman HERE


Blogger airth10 said...

“Why the Worst Get on Top”. That is the title of one of Hayek's books, as mention above.

An appropriate title for the day considering that tomorrow is the 40th anniversary of "Watergate". That dastardly deed was perpetrated by some of the worst that got to the top.

11:21 am  
Blogger Gavin Kennedy said...

I completely agree.

It was also an utterly futile exercise in power mania. Nixon had the votes for a sweeping victory but just couldn't resist to illegally using executive power to bug the office of the busted flush of the Democratic Party.

That is why Liberty is more important than democracy or any other alternative to it (most of them worse, I must say).


11:48 am  
Blogger airth10 said...


The irony or question is how can you maintain liberty without democracy?

12:27 pm  
Blogger SM said...

It appears the worst have stayed on top. Watergate seems trivial compared to now (warrantless wiretaps, indefinite detention, 30,000 spy drones, etc.) the only difference is back then people seemed to care about the law unlike now our investigative media is almost nonexistant and people just banter back and forth oblivious to real issues. (at least thats the way it seems for me)

A great tribute to Hayek and his insights into political science.

2:31 pm  
Blogger Gavin Kennedy said...

I have not space to make the full case for Liberty being more important than democracy, but the road to Liberty, as enshrined in the history of England, was one of gradual adoption of the instruments of Liberty from Magna Carta (a small step to shackling the power of Kings: judgement by peers, and later Habeas Corpus (ending arbitrary arrest), the King sharing governance with parliaments of peers and commoners, later, after Cromwell, parliament deciding on legislation of money bills, trial by Jury, Judges appointed for life and good behaviour, no standing armies (annual money bills through parliament), and later still, freedom of speech and assembly.
Many countries have 'democracy', without Liberty, too numerous to list. Only justice can maintain liberty.

3:40 pm  
Blogger Gavin Kennedy said...

Yes, little has changed. The perpetrators of illegal wiretaps were a minority. The anti-liberty people generally are a minority; no more numerous I suspect than previously. Both ends of the political spectrum have their practitioners of the 'dark arts'. We know more about the problem and ideas people - like Hayek and Smith - set out the alternative morality.
Pessimism is the default mode of Libertarianism.

3:49 pm  
Blogger airth10 said...

I thought the the Magna Carta was the start of democracy, not just liberty.

Liberty seems to be for some, whereas democracy is for all. I guess, though, if you are going to have democracy for all some are going to think they have lost their liberty.

Justice, if meant as the rule of law, does maintain liberty. But it also maintains democracy.

5:19 pm  
Blogger Gavin Kennedy said...

Of course most would agree that democracy with a justice system is better than liberty without democracy. The problem is that democracy without liberty is prevalent throughout the world, followed by governance without either mode; which was once the predominant form of governance across all human societies throughout history and pre-history.

Liberty, or rather steps towards liberty, were the first crucial steps towards democracy (hence , Magna Carta in recent history), but democracy was itself a long process, not a single event.
Universal suffrage only arrived in Britain in the 20th century, through various steps, not all at once (franchise restricted to property qualifications; they had the money the King wanted to access; gradual lowering of property qualifications to enfranchise more male payers; then all adult males (only whites in the US, until late 19th century - in practice until 1960s); spread of franchise to adult women.
So the outcome is not a free choice. The process is complicated. Hence, I support the clear benefits of liberty over the easy pretence of democracy as used by tyrannical leaders across the world (Zimbabwe, North Korea, Cuba, China, Syria, and the rest).

6:26 pm  
Blogger airth10 said...

Gavin: "Hence, I support the clear benefits of liberty over the easy pretence of democracy as used by tyrannical leaders across the world (Zimbabwe, North Korea, Cuba, China, Syria, and the rest)."

I am sorry but you are confused. Those countries you listed have nothing to do with democracy. Democracy is not just about casting a vote, if that is what you mean. It is about a system that honors and protects your vote. It is also cultural and a way of life that gives us, without making a big deal about it, choices, freedoms, mobility and, yes, liberty. We don't think about it.

Democracy is also about a built-in separation of powers. Those countries you listed have no separation of powers and therefore no democracy and certainly no liberty.

8:17 pm  
Blogger Gavin Kennedy said...

What you are describing is democracy supported by liberty, which, of course, is the optim-centre demoractic parties, moral philosophers, left-of-centre democratic parties, social democratic parties, and such like who participate in democratic processes in societies where Liberty is practised.
Openly tyrannical regimes dispense with both, but some tyrannical regimes try to clothe their tyranny with the trappings of democracy, including elections results with 98% majorities, making oppositions illegal, censorship, etc..
You try to restrict the definition of democracy to the democracy in liberty (the optimum combination), while excluding those behaviours that you (and I) disapprove of.
We should approach these issues as social philosophers, not with prejudices about what is or is not democracy. Hence, I argue: Liberty is more important than democracy. You cannot dispute the nature of Liberty, as defined, among others by Adam Smith. Where Liberty exists - the rule of law - democracy can flourish; without Liberty it most likely does not.


9:33 pm  
Blogger airth10 said...

Conservative love the idea of liberty. For them " liberty also implies that government won't stand in the way of individuals gaining as much economic power as they can as long as it doesn't involve criminal behavior."

What is criminal behavior? Under the definition of liberty it's probably not a landlord being able to over charge tenets for rent in a building that is in disrepair, or discriminating against people because he doesn't like them. If a landlord - he thinks, couldn't do those things it would infringe on his liberty. After all, it is his building.

Democracy is what brings justice to the situation, limiting the liberty of landlords so that they don't abuse their position and run roughshod over the less empowered. In essence democracy empowers the less liberated.

Democracy is a governing system. Liberty is not.

12:01 pm  
Blogger Gavin Kennedy said...

We are closer to an understanding of the relationship between Liberty and Democracy. Liberty is the central principle of justice and its protective role in the rights of individuals. It preceded democracy as we understand it from the late 19th century to its entrenchment from the by mid-20th century in some (few) countries.

Both Liberty and Democracy were preceded by many millennia of history and all pre-history by tyranny in its many varied forms.

You seem hooked on the idea that democracy, which has wide range of alternative forms, is an antidote to tyranny, because it brings justice to the "situation". Liberty is the rule of law, applicable to all.

Your examples of 'landlords' and the 'less empowered' miss the point. Liberty is not unbridled freedom. It is freedom under the law, enforced by justice. No owner of a building can do whatever she likes (commit murder, store flammable chemicals, radiation sources, hold slaves, commit offenses against children or a spouse, plot the violent overthrow of the government, and so on).

If the law infringes other people's rights, then it can be changed - democracy is a process not a one off event. Gradually the rights of the Barons against arbitrary rule by the King were extended to other prominent groups, and eventually to all citizens, a few hundred years later in some countries. Parliament, Congress, or National Assemblies can pass laws to rectify unjust laws that no longer serve their purpose. That is a role for democracy under Liberty. The law struck Nixon down, eventually.

"Democracy is a governing system", so is the rule of law under Liberty. The Founders of the US understood that principle of governance. So did the British parliament, eventually.

In my view, given the unfinished process of democracy in most human societies, Liberty is more important than democracy because it is Liberty that initiates what followed and guaranteed the rule of law that empowered the individual against injustice.

That you have concerns about some current power imbalances in your society is your right. These can be changed should you persuade others, recognising that others can persuade competitively against your proposals in due democratic processes, under the protection of Liberty for all of you.

4:05 pm  
Blogger Unknown said...

You said
"Liberty is not unbridled freedom. It is freedom under the law, enforced by justice."

Well, tell that the black slaves after the American War of Independence, fought on the principle of 'liberty'.
I am afraid you want to concretise a concept in the way you understand it rather than how it is generally understood (and of course changeable throughout time.)

‘When I use a word,' Humpty Dumpty said, in rather a scornful tone, ‘it means just what I choose it to mean—neither more nor less.' That appears to me to sum up what you mean by liberty.

airth10 won that exchange.

Nevertheless, I do like your website. You do try to keep your obvious bias away from your analysis of Smith, which other neo-liberals fail to do. For that you deserve a 'well done'!

2:34 pm  
Blogger Unknown said...

"Democracy is a governing system", so is the rule of law under Liberty. The Founders of the US understood that principle of governance. So did the British parliament, eventually"
Oh dear! Is that all you offer?

"‘When I use a word,' Humpty Dumpty said, in rather a scornful tone, ‘it means just what I choose it to mean—neither more nor less.
I think you apply a similar logic to the meaning of words as Humpty Dumpty. You seem to have a formalistic understanding of democracy but I but a personalised and idealised concept of liberty.

But of course that is not unusual in history. The American colonists thought that they were fighting the British for 'liberty' - but they were also doing it to preserve slavery, hence the hubris of the US constitution and their selective liking for Thomas Paine.

In your preferment of liberty to democracy you side with the American colonists. Of course liberty requires democracy, but democracy in the fullest sense - for example as JS Mill first began to describe and then as John Dewey developed it - is an unfinished quest. No society in the world had democracy at the time of Adam Smith. Today democracy is subverted by economic power. Dewey spoke of the shadow cast on society by big business” representing as the power expressed in the “private control of banking, land, industry, reinforced by comment of the press, press agents, and other means of publicity and propaganda.”
Of course, they are truly the propogators of liberty; in their own self-seeking terms of course.

Nevertheless yours is an intelligent blog. At last someone on the right who doesn't think Adam Smith was writing about recent events!

2:48 pm  
Blogger SM said...

Gavin, I believe Mr. Jones actually proves your point without even knowing it. In his description of early America and slavery, he is essentially describing a democracy that hasn’t fully accepted liberty. Was it democracy that eventually led to emancipation and/or the ideal of liberty that sparked the movement towards emancipation?

“Of course liberty requires democracy, but democracy in the fullest sense - for example as JS Mill first began to describe and then as John Dewey developed it - is an unfinished quest.” I believe you got this all backwards. It's democracy that requires liberty and the ideal of liberty is an “unfinished quest” that is best supported/attained through democracy.

I believe Gavin is correct to emphasize the importance of liberty over democracy.

4:53 pm  
Blogger airth10 said...

The objection I have with you people about liberty vs democracy is that things are not as clear cut as you make them out to be.

My argument is that there is no either/or, liberty or democracy. They both constitute a system of governance. It is a system that grew out of dual aspirations. Neither can live without the other and the friction between them is what keeps the system of liberal democracy vital and legitimate.

5:48 pm  

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