Hayek, champion of Western liberalism

Commentary on the
Cambridge Companion to Hayek

hayek-cambridge-companion

This most useful primer features three essays in particular that provided good reason to reflect again on the received wisdom and habitual misuse of Hayek’s name to justify a great range of nonsense, whether it is a cold-hearted defence of callous economic rationalism, sometimes known by the grotesque misnomer of ‘neoliberalism’, or whether he is proposed as a menacing heathen idol in simplistic denunciations of free market economics.

The first of these essays, ‘Hayek versus Keynes’, by renowned Keynes biographer Robert Skidelsky, closes a theoretical gap between John Maynard Keynes and Friedrich August von Hayek to a matter of degrees rather than apparently irreconcilable differences.

The second essay, ‘Hayek and liberalism’, by Chandran Kukathas, tantalisingly suggests Hayek’s major impact should be a perpetual call to action, challenging those who can to become activists in defence of liberal values with truth rather than expedient propaganda, by admitting mistakes and shortcomings, but contrasting these with detailed examples of the failures of liberalism’s enemies, as well as the enormity of the consequences of those failures.  It is an eerily appropriate challenge from the past when applied to circumstances in the present.

The third essay, ‘Hayek and conservatism’, by Roger Scruton, is an eloquent, almost convincing rhetorical claim of inextricable kinship between theoretical liberalism and practical conservative politics, which does not excuse or offer refuge for the mercenary, self-serving kind of opportunism so often misleadingly described as conservatism in contemporary political commentary and practice.

Taken separately these essays are each among the best examples of their type, but in conjunction, offer a beguiling glimpse at Hayek as much more than the sum of the parts of his own considerable output.

Keynes as exception to Hayek’s rule

Skidelsky’s engaging essay traces often remarked-on differences between Hayek and Keynes to different temperaments and approaches rather than fundamentally different theories on economic matters:

The optimism of Cambridge confronted the fatalism of Vienna.

The contrast which sums it up may be expressed by saying that Keynes believed that ‘‘in the long run we are all dead,’’ whereas Hayek believed that in the long run we learn wisdom (p 85).

In doing so, however, Skidelsky highlighted that it was the extremities of great crises that influenced both men’s thinking: the great depression of the 1930s and WWII.

Skidelsky does not minimise the tension between the Keynesian argument for state intervention to alleviate particular economic or market ruptures and the Hayekian prescription that the market will ultimately be self-healing and should not be unduly interfered with by the state.  What is more interesting about Skidelsky’s observations, however, is that Hayek was more the scholar and theoretician, while Keynes was more inclined to action, which is in itself not possible without the agency of state intervention.

Most insightful in that regard was Skidelsky’s illumination of Keynes’ personal correspondence to Hayek on publication of the latter’s The Road to Serfdom, in which ‘Hayek set out to uphold the “fundamental principle that in the ordering of our affairs we should make as much use as possible of the spontaneous forces of society, and resort as little as possible to coercion”’ (p 101).

Skidelsky, explicitly recognising that a full debate between Keynes and Hayek was forestalled by the former’s death, nevertheless suggests:

Keynes would have endorsed all that Hayek wrote of the connection between political and economic liberty, of the importance of allowing the individual to be judge of his own ends, of competition as a better way of adjusting individual efforts to each other than any other, of the advantages of decentralized decision making, and so on. He would have agreed with him that democracy is a means, not an end. He would have applauded his discussion on international freedom, and the conditions needed to secure it. He would certainly have endorsed his strictures against excessive state spending. He might even have agreed with much of Hayek’s account of the reasons for the decay of European liberalism (p 102).

It is a declaration of like-mindedness somewhat surprising in its contrast with the uses to which the words of these two men have been put by others.  This is not a contrast or conclusion drawn by Skidelsky himself, though I think it is not entirely an accident that he acknowledged a practical difference while almost denying the theoretical dichotomy that is relied on by many contemporary commentators and political practitioners in lending weight to arguments for and against state intervention into markets.

Most tellingly, Skidelski quotes Keynes, writing to Hayek in 1944, virtually conceding the point that state intervention was in fact undesirable:

Dangerous acts can be done safely in a community which thinks and feels rightly which would be the way to hell if they were executed by those who think and feel wrongly (p 104).

Skidelsky, himself an unabashed admirer of Keynes, admitted that Hayek’s concerns had some basis in fact:

A society in which “dangerous acts” by governments become continuous will lose its understanding of why they are dangerous – that is, its sense of what it is to be free. And this has happened to some extent (ibid).

Skidelsky’s conclusion that Hayek was, perhaps, too rigid in his defence of liberty, and Keynes a more popularly acceptable, flexible face of liberalism, rings true.  When the choice is between starvation and upholding liberty, theoretical rectitude will always take a distant second place.

Robert Skidlesky.
Robert Skidlesky.

Something not touched on by Skidelski, nor by a great mass of free market defenses, is that Hayek, like Adam Smith, did not anticipate the full extent to which contemporary markets might be manipulated and distorted by amoral corporations rather than, or as well as, the political state.  There appears to be little in either Smith or Hayek to support the notion that when state controls over markets are relinquished, unregulated private controls should take their place.  In fact, Smith wrote a thesis on ethics, and Hayek wrote a detailed defence of liberty, which can be threatened just as thoroughly by private as by state tyranny.

One must wonder what Hayek might have made of the labyrinthine machinations devised by corporations to control political processes, to exploit the absence of enforceable international law, to evade taxes, to collude with other corporations on price fixing and excluding newer competitors, etc.

Hayek’s liberal activism

All the nonsense being talked about ‘neoliberalism’ [1] aside, it is a little surprising to read Kukathas propose that Hayek ‘has gone unrecognised by most contemporary political theorists as a contributor to liberal thought – or indeed to political thought more generally – in the twentieth century’ (p 183).  How could such a conclusion escape anyone who has read The Road to Serfdom and The Constitution of Liberty with any care at all?  It is unarguable that Hayek’s theories oppose socialism, but the socialism he opposed was the extreme kind of his day, which had more in common with fascism and other kinds of totalitarianism than contemporary pejorative descriptions as socialism of any call for state intervention at all.

Kukathas certainly made the point that a substantial part of Hayek’s early political writings and activism were inspired by his opposition to Nazism[2], which led to his astonishingly far-sghted concern to re-integrate Germany into Western civilisation after the Nazis had been defeated, even before that was an accomplished fact.

As Kukathas put it, Hayek’s opposition to totalitarianism rested on the argument that:

demands for conscious control or direction of social processes can never be met and that attempts to gain control or to direct social development can only result in the loss of liberty and, ultimately, in the destruction of civilizations (p 184).

It is a convincing claim that has not yet been refuted persuasively.

However, the emergence of transnational corporations with budgets and powers as extensive and directed as entire nations makes such non-state actors on the global stage every bit as dangerous to liberty and societies as any other force seeking to control and direct social processes.  That corporations do indeed seek to control societies is evidenced by quite open and aggressive efforts to influence political processes with money and lobbyists, and to direct social processes with news, advertising, and entertainment media for the sole purpose of maximising profit.[3]

An intriguing question raised by Hayek’s conceptions, and the apparent aim of modern corporations to alter post-war liberal democracies for their own purposes, is what are the distinguishing features of Western societies and civilisation?

Friedrich von Hayek.
Friedrich von Hayek.

Hayek’s distinctive contribution is his account of social institutions and rules of conduct as bearers of knowledge. Society may profitably be viewed as a network of practices and traditions of behavior that convey information guiding individual conduct. These institutions not only facilitate the matching of means with established ends, but also stimulate the discovery of human ends. Hayek’s argument is that it is vital that society not be brought under the governance of a single conception of the ends of life which is held to subsume all the various purposes human beings pursue, for this can only stifle the transmission and growth of knowledge.

The second assumption underlying Hayek’s political philosophy is that individual freedom is not to be understood in terms of man’s capacity to control his circumstances, nor in terms of collective self-government. Rather, freedom obtains when the individual enjoys a protected sphere or domain within which others may not interfere, and he may engage in his separate pursuits in accordance with his own purposes (p 184).

It seems clear that profit is no more eligible as a sole purpose of human ends than secular religions like communism or fascism.  Kukathas’ narrative goes on to make the expected points about Hayek’s opposition to aggressive state intervention, but more pertinently that Hayek:

saw “civilization” coming under threat from two significant forces: nationalism and totalitarianism. The danger lay not merely in the victory of a particular political party but in the victory of ideas which had the capacity to undermine European civilization (p 187).

Not content with recognising this danger, Hayek had some ideas on what to do about it:

The answer, he thought, would have to involve at once subjecting those ideas to sustained criticism, and developing and promoting the liberal alternative. It is very important to note here two things: first, Hayek did not see this as essentially or primarily a philosophical task, but rather as an intellectual task which required the contribution not only of philosophers but also of economists and other social scientists, as well as (perhaps most importantly) historians. Second, Hayek believed quite firmly that for this task to meet with success it was necessary that the battle of ideas be engaged not merely in academia but in the broader public realm (pp 187-188).

To persuade the German people that to overlook or excuse Nazi excesses was delusional and dangerous, he determined that they:

needed to be made aware of the facts in a sober, dispassionate, and matter-of-fact way. That this process of “propaganda” seemed too academic, he thought, did not matter. The important thing to do was to tell the truth, to admit mistakes when they were made, and to be sober and accurate in a way that Nazi propaganda was not (p 188).

This was, perhaps, ambitious and overly idealistic given the political circumstances of the time — the late 1930s and early 1940s.  But it is a prescription that deserves bearing in mind for today and tomorrow: truth as defence of liberal principles against their antagonists and subverters.

Winning the intellectual argument was not enough for Hayek.  His ambition was extensive but prescient in proposing:

that something be done to recover and restore German moral and intellectual life. However, Hayek’s concern was not simply for Germany’s own well-being. The fate of Germany was entangled with the fortunes of Europe, and Germany could not be lost if Europe was to survive the war (p 189).

Kukathas doesn’t make explicit mention of it, but it appears that Hayek regarded Soviet communism as a bigger and more persistent threat to European civilisation than the Nazis.  In terms of its greater longevity and subversive effects on intellectual debate in the West, history might support the proposition that this was an accurate assessment at the time.

Catallaxy

Kukathas doesn’t spend a lot of time explaining Hayek’s exchange theory, ‘catallaxy’, possibly because the reader is expected to have some knowledge about it already, but it is worth digressing to trace its origin to the Austrian School of economics led by Ludwig von Mises, a major influence on Hayek and originator of the term ‘catallactics’, which, in turn, has its origins in the Greek word ‘katallasso’, which can mean ‘to exchange’, ‘to admit in the community’, and ‘to make friends’.

Hayek’s conception of catallaxy was probably focused fundamentally on the idea that, like Smith’s invisible hand, there is a mechanism of exchange that creates the knowledge necessary for markets to function.  However, the term invites extrapolation.

Understanding or interpreting catallaxy could extend to notions of a broader ‘engagement’ model rather than one of exchange only without violating Hayek’s unfinished ideas about it.  The term engagement might be a useful adjunct to catallaxy because it does not exclude contacts and entanglements in which there is no direct material exchange, such as martial and intellectual stalemates, decisions not to enter into an exchange despite its possibility, and accidental or tangentially intended cross-pollination of ideas or third and fourth-party exchanges.

Viewing Hayek’s idea of catallaxy as an engagement model does not preclude exchanges, but organically extends its purview to the realm of social custom, ethical ideas, and common dispositions, such as those Hayek thought of as comprising liberal thought.

Western civilisation

Using this extended concept of catallaxy offers a promising glimpse of a society of reason in which social meanings are negotiated between individuals on the basis of custom and precedent, but also on the basis of entirely new engagements, and shared more generally across groups that then become specific societies, several of which, in turn, come together on common ground to make up a civilisation.  The common ground here being the Hayekian ‘network of practices and traditions of behaviour that convey information guiding individual conduct’ that would be recognised individually by individual members of a society as binding them to others across communities elaborated eventually into entire civilisations.  This interpretation isn’t entirely novel, because Kukathas implies it, and because it anticipates a key feature of Roger Scruton’s essay, social membership, discussed later in this commentary.

In this context it becomes easier to discern how a set of predispositions, customary beliefs, and engagement models (ie, ecclesiastical, artistic, chivalric, mercantile, political, civil, and scientific codes of practices, etc) might have developed across initially diverse and hostile European clans, tribes and principalities to assist their evolutionary development into kingdoms and nation states that often fought each other but nevertheless acknowledged a greater degree of community between each other than, say, with the Saracens or Ottoman Turks.  That sense of community may be what Hayek described as European civilisation.  It is a definition that could easily extend to read ‘Western civilisation’ on the basis that the Americas, Australasia and some parts of the Middle and Far East, and Asia share this sense of community, even if sometimes only as European colonial heritage for some.

Defining liberalism

A starting point comes from Hayek’s proposal for an international philosophical society designed to re-integrate German thought, in which he argued for identifying values and:

sorting out of those which must in all circumstances be preserved and never sacrificed or endangered for some other “advances,” and a deliberate effort to make people aware of the values which they take for granted as the air they breathe and which may yet be endangered if no deliberate effort is made to preserve them (p 191).

At this point Kukathas makes a departure into contemporary liberal theory via Rawls and others that will not be restated here.  It seems that despite Hayek’s voluminous work on the subject, the nature of his conception of liberalism almost defied its definition and codification:

… if moral values were to be shared across a wide range of people, the scope for agreement on substantive questions would be reduced. This, he argued in Law, Legislation, and Liberty, was one of the reasons why liberal ideas were difficult to defend.

“The resistance against the new morals of the Open Society was strengthened also by the realization that it not only indefinitely enlarged the circle of other people in relation to whom one had to obey moral rules, but that this extension of the scope of the moral code necessarily brought with itself a reduction of its content.” (p 197.)

This implies that liberty, or individual ‘rights’ are negatively defined by the empty spaces between prescriptive legislation and unwritten rules that prohibit certain kinds of conduct.  A corollary of that approach is that liberalism inherently favours a non-interventionist approach to social regulation as much as to the market in order to leave large empty spaces between the prescriptive interventions.  Hayek saw this as a balance between state intervention on behalf of a community of individuals, and the freedom of individuals to pursue their own interests and ends free from state coercion, which he thought should be heavily biased towards individual liberty, or, at worst, ameliorating some desperate injustice suffered by those least able to help themselves.

Kukathas said:

The expansion and development of human knowledge he thinks is generally stifled by attempts to control it or direct it. The growth of knowledge is greatest when spontaneous interaction among individuals and institutions to solve problems of adaptation leads to solutions which were unforeseen and unexpected. The threat to this process comes from attempts to organize the social process; and the greatest attempt – and threat – comes from the state (p 198).

It seems that Hayek was concerned mostly to see the state prevented from being used as an ideological tool for economic and social intervention of the kind necessary, for example, to impose a particular contrived (as opposed to naturally evolving) notion of social justice, such as those that imposes wealth re-distribution to actually create a new inequality in place of, or in addition to, the old one (often referred to without a hint of irony as ‘positive’ discrimination).  At its extremes, such intervention has, in the past, become nationalist fascist or communist tyranny.  Today we might add also a particular form of theocratic Islamic tyranny.

The only way to combat these forces was with the ideas which were their antithesis: the universalist, egalitarian, and libertarian ideas of liberalism (p 197).[4]

And:

All this is possible, however, only if there is widespread agreement on some values. These are the values which lie at the core of liberal political philosophy, and which include the respect for the idea of individual freedom and an opposition to totalitarianism (p 202).

Hayek, true to the notion that prescribing limits or scope inevitably narrowed liberty, described the values to defend against the depredations of interventions as those that were the inevitable target of such intervention, namely ‘individualist, universalist, and egalitarian moral principles’ (p 203) presented as ‘a doctrine of individual liberty’ (p 202).

To critics of the left, coming from an intellectual discipline that requires and imposes strict codification, this approach applied to statecraft is likely to be infuriatingly ethereal and intangible because it can take so many different, unexpected, and therefore unpredictable forms under equally diverse circumstances without ever running the risk of being internally inconsistent.

Amoral capitalism: the inheritors of Reaganomics and Thatcherism.
Amoral capitalism: the inheritors of Reaganomics and Thatcherism.

That problem becomes less complex when confronted by the tyranny of completely unregulated markets manipulated by amoral plutocrats: democracy can be used legitimately to limit the capacity of corporations to dictate ends and means to individuals or entire societies.  That kind of intervention is no longer one of regulating the market so much as regulating the antisocial tendencies of corporations, which are neither ends in themselves, as some would have it, nor the ends of all human purposes.

Moving beyond the theoretical ideas suggested by Hayek and into the realm of practical contemporary politics, liberalism is all but impossible to nail down to fixed positions because context and judgements are required for every specific circumstance, including the degrees of state intervention that are to be tolerated (as discussed in the previous section on Keynes and Hayek), and because of perennial political pressures to intervene on behalf of specific interest groups.  Pressures that are concrete and not resolvable by theoretical considerations alone.  At the point at which a preference to eschew state intervention becomes doctrinaire and absolute, as might be said of Reaganomics, Thatcherism, and their successor ideologies, it is no longer liberal so much as authoritarian, or even totalitarian.  There is nothing at all ‘neo’ about something that isn’t liberalism in the first place. Instead, it might be argued that neoliberalism is in fact an inappropriate catch-all phrase to describe contemporary forms of reactionary politics in the US that overtly advocate plutocratic totalitarianism.

If Hayek is read as prescriptively demanding a dogmatic opposition to any intervention at all, he will be seen as other than liberal, which might explain why he has not been recognised as a liberal thinker by those who have read him too literally, and those whose readings have been too shallow.

It appears rather obvious that in practice rather than purist theory, liberalism cannot but exist in a state that must countenance some degree of intervention.  That is not to say, however, that there cannot or should not be vigorous debate about each proposed (or existing) state foray into regulating economic and social activity.

The call to action

The strongest impression Kukathas’ essay left was about Hayek’s call to action: the proposition that academics and public intellectuals alike should make concerted and persistent efforts to counter populist justifications for the infringement of liberal notions of liberty and egalitarianism, and that they should do so truthfully, acknowledging mistakes, inequalities like market or social failures, but also that they should provide information in depth about the excesses and consequences of specific interventionist policies.  It is unavoidable to conclude in a contemporary setting that such excesses include those deliberately planned and executed by trans-national bodies like corporations, but also the UN, or extremist trans-national movements.

Scruton’s conservative interpolation

Curiously, the third of The Cambridge Companion essays suggests that it is in the ranks of traditionally conservative thinkers and politicians that there might be some hope for a revival of a vigorous liberal dialogue.  Roger Scruton accomplishes this herculean feat with the somewhat intriguing assertion that:

Hayek does not engage with the real, deep-down conflict between conservatism and socialism, which is a conflict over the nature and conditions of social membership. In this conflict liberalism must learn to fight on the conservative side. For liberalism is possible only under a conservative government (p 229).

In making his pitch that Hayek’s core theories are most nearly compatible with political conservatism, Scruton makes some elegantly worded observations about Hayek’s position on undirected social formation.

He traces Hayek’s notion of a freely evolving but rational order ‘from our myriad intentional actions’ that creates ‘a distribution of wealth, power, and accountability that is no part of anyone’s intention’ back to Adam Smith’s invisible hand, and to Darwinism via an ‘evolutionary rationality’ that ‘consists not in a plan but a process, whereby individual plans adapt to the plans of others’ (p 209).  In doing so he does not reveal his own theoretical base, and he makes the somewhat incongruous assertion that Hayek was opposed to egalitarianism:

His attack on egalitarianism is not based on any defense of the market economy but on the belief that inequality is the spontaneous outgrowth of peaceful exchange in every area of human intercourse, and that the attempt to suppress inequality is both bound to fail and also bound to threaten the collective accumulation of socially useful knowledge (p 210).

The substance of the assertion may be literally true, but its assumption that this is an attack on egalitarianism is misleading: Hayek’s notion of egalitarianism seems to be more wedded to the liberal idea of equality under law, based on the notion of a justice that is neutral about an individual’s means, ends, or social standing, not on the assertion of legislative intervention to create an artificial equality, nor the demand that no efforts be made at all to alleviate inequalities, particularly if leaving them unaddressed creates a political crisis of confidence, or instability with the potential to undermine social cohesion more generally.

Scruton was more compelling on Hayek’s conception of an evolutionary, spontaneous order:

Hayek’s epistemic theory of the market does not claim that the market is the only form of spontaneous order, nor that a free market is sufficient to produce either economic coordination or social stability (p 212).

And:

The market is held in place by other forms of spontaneous order, not all of which are to be understood simply as epistemic devices, but some of which – moral and legal traditions, for example – create the kind of solidarity that markets, left to themselves, will erode (p 212).

This point is an interesting concession to a positive rôle for intervention, even if this intervention is conceived of as ethical rather than political.  As such it suggests a ‘community’ of actions manifested in extemporary, unenforceable ‘intervention’ and ‘regulation’ of not only market forces, but of all social processes altogether, including indirect political engagements, such as those founded in academic and public debate, and in social interactions between individuals and groups at a level anterior to party political organisation and solidarity.

Roger Scruton.
Roger Scruton.

Scruton’s examination of catallaxy is carefully crafted, almost like the ingenious resolution of a mystery in the final moments of an American thriller, showing a clever lawyer explaining the locations of motive, opportunity, intent, and even a dose of alibi in animating a mildly prosecutorial amicus brief seeking to incorporate Hayek’s theories into an intellectual construction that is not quite Hayek’s, but seems very persuasive about what he might have agreed with.

Central to that construction is Scruton’s focus on British common law, seen as an abstract, non-specific system of rules, and, perhaps, as the principal social and moral engagement model of liberal society as conceived from a British point of view.

The starting point for Scruton is Hayek’s likely critique of legal positivism as a negative feature in seeking to impose a conception of justice and morality through law, rather than ‘discovering’ existing law as in using common law to settle disputes (pp 214-216).

Abstract rules, as Hayek calls them, are not part of a plan of action, but arise from the enterprise of social cooperation over time. They are the parameters within which the cooperation of strangers to their mutual advantage becomes possible. … they provide knowledge that has stood the test of time, by permitting the resolution of conflicts and the reestablishment of social equilibrium in the face of local disturbances. By following these rules we equip ourselves with practical knowledge that will be especially useful when venturing forth into the unforeseeable – namely, knowledge how to conduct ourselves toward others, so as to secure their cooperation in advancing our aims.

To put the point in another way, the law condenses into itself the fruits of a long history of human experience: it provides knowledge that can be neither contained in a formula nor confined to a single human head, but which is dispersed across time, in the historical experience of an evolving community. Just as prices in a market condense into themselves information that is otherwise dispersed throughout contemporary society, so do laws condense information that is dispersed over a society’s past.  (p 218.)

Scruton’s language is so velvety that one could be forgiven for being suspicious of his veracity, but it rings true by way of a tangential reference to an unrelated and entirely unexpected source: the Old English poem Beowulf.  It is one of the few documents that hints at a European heritage not rooted in classical antiquity, and therefore not in the assumptions of Greek and Roman customs or statecraft.  Beowulf speaks of rules of conduct that existed without the force or even existence of a state to enforce them.  There was only the chaotic force of arms with its uncertain application and outcome.  The epic tale nevertheless reveals a social order and rules of conduct understood between diverse Germanic tribes, such as the (proto Swedish) Geats, the Danes, southern (German) Goths and perhaps even the Merovingians.  These rules may have been pretty basic, being that they applied to roving bands of mercenary thugs, murderers, and thieves feuding among each other, but they seemed to have had effect by invocation of custom: calling on the integrity of others to adhere to such customs as evidence of their moral fibre and worthiness to call friend or ally (perhaps even worthy foe).  Thus the compensation of mercenary duties with material goods was an accepted exchange model, as was payment of bribes to ward off rapine and pillage, or to compensate the effects of murder and theft, which might otherwise have led to further feuding.  The Grendel’s imperviousness to a material bribe offered as inducement to stop his slaughter, for example, was evidence enough of his status as a transgressor and therefore an enemy of all rule-bound Germanics.  The conception in Beowulf of the ‘right thing to do’ is eerily close to the abstract, unwritten catallactic rules that Scruton puts in Hayek’s unseen but corporeal hand, like a smoking gun, and is entirely compatible with Scruton’s prescription that:

the knowledge that we need in the unforeseeable circumstances of human life is neither derived from nor contained in the experience of a single person, nor can it be deduced a priori from universal laws. This knowledge is bequeathed to us by customs, institutions, and habits of thought that have shaped themselves over generations, through the trials and errors of people many of whom have perished in the course of acquiring it (p 218).

In this passage Scruton unwittingly puts his finger on the potential reason why a particular type of American capitalism is so corrosive of liberal democracy, liberty, and egalitarianism.  It may be that an American exceptionalism, which rejects any continuity of its history, customs, and practices into a non-American past, also rejects the ethical and social constraints on acting with ferocious barbarism to pursue profit at the expense of social cohesion or public benefit that is regarded as integral to the notion of Western societies elsewhere (or even by opponents of such forms of ‘free market’ capitalism within the US).

The sacredness of sexuality?

For reasons that are almost opaque, but may have some arcane significance for conservatives of Scruton’s persuasion, he digresses into an oddly sentimental and unconvincing defence of sexual puritanism as evidence of the kind of ethics which, he says, are one of the qualities required to keep the market humane in the absence of more direct intervention.

Traditional sexual morality, for example, which insists on the sanctity of the human person, the sacramental character of marriage, and the sinfulness of sex outside the vow of love, is – seen from the Hayekian perspective – as a way of taking sex off the market, of refusing it the status of a commodity and ring-fencing it against the corrosive world of contract and exchange. This practice has an evident social function; but it is a function that can be fulfilled only if people see sex as a realm of intrinsic values and sexual prohibitions as absolute commands. In all societies religion, which emerges spontaneously, is connected to such ideas of intrinsic value and absolute command. To put the matter succinctly, that is sacred which does not have a price (p 220).

Scruton’s odd departure into sexual morality seems even more odd in light of his later comment that the ‘true default position of mankind … is priest-haunted tyranny’ (p 227), a statement that surely clarifies the nature of the kind of puritanical tyranny that has most notably championed the rather quaint, romantic notion of a chaste and ascetic sexual morality, elevating it into a psychotic fetish the way starchy, patrician Victorian Britishers did in the 19th and early 20th centuries.

Most disturbing of all the possible meanings behind Scruton’s departure into the scared is that it rings alarm bells about its proximity to the rhetoric of the Christian right in seeking to ostracise or banish homosexuals from civil society as somehow deviant in their own sexual mores when contrasted with the ‘sacramentality’ of the heterosexual analogue, and to deny or remove the full protection of property rights for same-sex unions.  It is not that Scruton demanded it, but that the very notion of the ‘sacrosanct’ implies it in the context of contemporary theological invectives and controversies.  Such a position is odiously illiberal and entirely incompatible with Hayek’s conception of liberty and egalitarianism, albeit that Hayek did not explicitly promote specific human rights issues.

The ‘weasel-word’ digression

Much more convincing is Scruton’s critique of contrived social rules, particularly by means of his ‘weasel-word’ digression, in which he draws attention to Hayek’s abhorrence of conceptions like ‘social justice’ on the basis that it is a contradiction in terms, the way that the very act of using the adjective ‘social’ to qualify the noun ‘justice’ robs the latter of its meaning:

Hayek describes it as a “weasel word,” one that sucks the meaning from whatever term it is attached to, “as a weasel sucks eggs.” Words to which this parasite attaches itself are turned from their referential purpose, and made to perform a task that is the opposite of the one for which they were designed. In the name of social justice any amount of injustice can be inflicted; in the name of the social market the market itself can be destroyed; and so on. And the word “social,” used in this way, does not merely destroy its successor – it destroys itself. It no longer refers to society, that benign and spontaneous byproduct of human sympathy, but to the state, which acts in the name of society but to society’s detriment. Social justice means state control, the social market means state distortion, and social morality means the chilling puritanical edicts with which socialists bar the way to success (p 221).

Ironically, reflecting on the meaning of ‘social media’ today might lead to similar conclusions about certain corporations.  Meaning only that the scope for intervention extends well beyond the state in contemporary dynamics.  Nor is ‘social’ anything the only kind of extant weasel-word.  Other suspect phrases that come easily to mind are ‘economic adjustment’, ‘collateral damage’, ‘value-added’, ‘misspoke’, and ‘downsizing’.

The quest for membership

These digressions aside, Scruton’s concrete aim is extrapolating an effect that gives rise to a spontaneous social order from Hayek’s theories and their consequences.  If social engineering is to be avoided for its centrally planned intervention and the inevitably authoritarian characteristics of that approach, what takes their place in Hayek’s liberal theories, and, more importantly, in Scruton’s conception of a conservative liberal approach?

Scruton excludes positivist pretenders, such as the notion of egalitarianism rooted in a resentment-driven demand for re-distribution of outcomes, which inevitably functions only to impose an artificial equality unrelated to natural, inherited, achieved and chance advantages (ie, brilliant intellect, inherited property, business success, and the lottery effect in any one or more of the former); a re-distribution to overturn ‘natural’ advantage is regarded by Hayek and Scruton as legislated inequality, and not without some justification.

Scruton further eliminates social contract as the glue that binds societies together on the basis that there is not adequate compulsion to adhere to the dictates of a contract without resorting to tyrannical state intervention.  Instead he attempts to locate an alternative compulsion or, rather, proclivity, in the concept of ‘membership’.

It comes to us with imperative force. For some it has a religious meaning; for others it speaks of home, neighborhood, language, and landscape. Where the experience of membership is absent society fragments into families, gangs, and clans, as in Africa today. And there is no instance of a catallactic order in the modern world that does not depend upon national loyalty – a loyalty that may very well be threatened by too great an emphasis on the free and sovereign individual (p 225).

These words could be interpreted with a particular referential quality as a critique of ‘multiculturalism’, perhaps to be regarded as a failed concept because it acts contrary to creating a sense of membership and ‘belonging’ by legislatively enforcing an idea of equality that does not and, perhaps, should not exist if the idealism behind multiculturalism is to be achieved.  State compulsion to regard as equal that which is not will achieve the opposite.  To exist it must be the unaided aim of the members to aspire to that membership rather than to have it handed to them as a written but empty guarantee.

What is it that motivates and evidences such membership?  Scruton’s words defy paraphrase:

The motives of membership are love, gratitude, and fear – love of country, language, neighbors, family, religion, customs, and home, gratitude toward these things as the source of life and happiness, and fear of their dissolution and of the anarchy, enmity, and predation that would then ensue. All of those feelings flow into a common reservoir of loyalty, which maintains the community in being and overcomes the problem of the “free rider.” For some this loyalty takes a religious form – the loyalty of the “creed community,” as Spengler called it. For others, who have passed through the Enlightenment experience, loyalty is directed to the nation and the homeland. Others still lack the feeling altogether, and identify themselves as in some way outside the society by which they are nevertheless surrounded and on which they depend for their groceries. Loyalty brings the capacity for sacrifice. And sacrifice means the preparedness to lose control of your budget, to cease to maximize your own utility, to lay down your life, in extremis, for your unknown friends. It is part of the business of politics to sustain the conditions under which this loyalty arises, and liberals (in Hayek’s sense of the term) have argued, on the whole, as though loyalty did not matter, or as though it could be costlessly replaced by relations of a purely contractual kind (p 226) .

And:

Membership brings a vital piece of knowledge to those joined by it, namely knowledge that they are so joined, and therefore can trust each other. From that knowledge the catallactic process can begin.  (p227.)

Referring back to the example of Beowulf, it is the membership found in opposition to the Grendel (or, in its absence, to some other ‘common’ enemy) between the poem’s thugs, and those of other gangs and tribes, that makes meaningful exchange or engagement between them possible, and that prevents the disintegration of even the most rudimentary forms of social organisation (allegiance of propertied thanes to a prince or lord) altogether, allowing feuds to be settled by alliance and bribes, and the sense of membership to be extended by mutually beneficial confederations.

It is not too difficult to recognise membership and a sense of loyalty as motivating degrees of unselfish sacrifice to assist ‘unknown friends’.  More than that, this sense of membership offers an apparently real stake to otherwise uninvolved people in the results and benefits of the critical ‘trials and errors of people many of whom have perished in the course of acquiring’ the collective wisdom and insights embodied in the best of Western political, social, cultural and economic achievements (p 218).

Scruton’s failing is not his reasoning, but rather the absence of traditional conservatives in a political landscape that has seen krypto-sociopathic reactionaries drive out their more temperate fellow travellers, and forced former parties of the left to become a new kind of conservative movement that pays lip-service to progressive ideals but serves only to maintain a thoroughly unprogressive status quo.

There are no conservatives left for liberals to seek alliances with, if, in fact there are actually any liberals either.

Conclusions

Hayek’s work, like the works of many other thinkers, ought to be read less like a manual and more like the transcript of a fascinating contribution to an ongoing dialogue about Western ideas.  Hayek’s thinking about liberalism and state intervention provides an insight into an approach, and suggests some basic ingredients, but not an outcome or steps for getting there.

In that context the three essays considered here provide impetus for the reinterpretation or appropriation of Hayek to new ends and perspectives.

hayek-constitution-of-liberty

On Intervention

A seemingly obvious observation to make is that Hayek’s work, particularly The Road to Serfdom (1944) and The Constitution of Liberty (1960), were direct responses to the specific circumstances of the pre and post war world as seen through European eyes.  Its concerns were about European civilisation and politics, not at all about America, the third world, or the emerging new superpowers of my era.  This necessarily means that Hayek’s ambit was limited to a world largely transformed and superseded even within his lifetime (1899-1992).  This does not invalidate what he had to say, but it makes it facile to attempt too literal an application of his ideas to contemporary issues.

It appears that the markets Hayek was describing seemed far more opaque and imposing than they appear to some today.  Technology has offered fantastic new ways to analyse market dynamics and to model behaviours, apparently removing some of the mystery of the invisible hand, though clearly not its unpredictability and imperviousness to contrived control.  A corollary of this perspective is that market intervention is today more likely to come from private actors than states, and with catastrophic effects to societies arising from their sole focus on short-term profit with its inevitable wholesale rejection of ethics, social responsibility, or political accountability.

Perhaps it is time for all those who would claim otherwise to acknowledge that in the most important respects Hayek and Keynes were in agreement, not implacably opposed.  What links them is an underlying philosophy that was alternative to central planning rather than an adjunct of socialism as has been alleged of Keynes’ theories, or a mortal enemy of socialism, as has been more credibly suggested of Hayek’s stance.  In being so inclined, these two men nevertheless sought to outline the conditions under which state intervention into markets (and society) were appropriate and to what extent or with what scope such intervention was to be carried out.  It seems to be just self-serving ideological rhetoric to suggest that Hayek had no room for intervention at all; it is certainly an error in fact to propose that Hayekian economics is necessarily antithetical to some state welfare measures or an ethical face to economic management.

On liberalism

Hayek’s liberalism was flavoured by an idealistic internationalist aspiration that pre-dates the obscene corruption of the UN and its rejection of the Millsian suggestion that nation states appear to be the most nearly appropriate entities in which liberalism can flourish.

Nevertheless, there is something to be said for Hayek’s vision of an entire civilisation united in a common approach to liberty, egalitarianism, and opposition to tyranny, particularly where this relates to the prospect of ‘rescuing’ other logical members of such a community from temporary digression into, or hijack by tyranny.  It opens the prospect, for instance, of welcoming into the community of Western civilisation the former Soviet republics, the more recent Asian democracies, and, in time, perhaps even China, if its own peculiar cultural chauvinism can accommodate the prospect.

The gaping hole in Hayek’s theory is the problem of non-Western opponents to liberal values, who cannot be ‘re-integrated’ into what they were never a part of in the first place, and whose demands to be accorded a legitimate right to differ from liberal values cannot be contradicted without resort to tyrannical measures.

Put another way, in terms of Scruton’s notion of a social membership recognised as such by its members in an informal way, it is a legitimate aspiration not to wish to recognise membership to a community of liberal interests.  In this regard an international economic interdependence may assist in avoiding conflicts, but not if the political economy underpinning it is a tyrannical one, like the economic imperialism of America’s post-war military adventures.

The nation state

International relations aside, it appears reasonable to say that a personal liberalism is bound to be geographically constrained in its immediate expression, aspiration, and concerns.  The boundaries of village, city, region, and country are the most relevant delimitations of most people’s everyday concerns in that they most immediately affect livelihoods, ‘groceries’, as Scruton put it, and the most immediate manifestation of politics.  This recognition of self as tied to a particular place and polity creates a motive for people to be concerned with its prosperity and success, and rationally inspired by self-interest to want to see it succeed, including through their own efforts.  Such considerations extend to a direct interest in the success or ‘wellbeing’ of the wider society around people, and, as a matter of consequence, also in the success of the civilisation that this society is a part of, even if only in a more indirect and abstract way.

Unlike Hayek, one can arrive at individual participation in the greater success by focusing on the smaller one, and by relying on Hayek’s notion of ‘evolutionary rationality’, which plays out better in circumstances where there is competition within Western civilisation at national and sub-national levels, with ideas, economic approaches, and engagement models being constantly tested against, and compared with each other, offering opportunities for cross-pollination without the risk of receding into sterile incestuousness, or of creating open conflict instead of synthesis.  This like-minded but nevertheless individualistic ‘rivalry’, and organic appropriation or adaptation of the best, most suitable variants across the entire civilisation appears to be in keeping with the evolution of a spontaneous order Hayek seemed wedded to as a theory.

Having assumed a ‘community of interests’, one can’t avoid grappling with what those interests might be.  They may include ‘universalist, egalitarian, and libertarian ideas of liberalism’ (p 197), ‘respect for the idea of individual freedom and an opposition to totalitarianism’, expressed in ‘a doctrine of individual liberty’ (p 202) that promotes and protects ‘individualist, universalist, and egalitarian moral principles’ (p 203).

There is an interesting aside here: why did Hayek not condemn the Washington model of democracy for its positivist approach to liberty?  In circumscribing rights to only those that can be derived from the US constitution, the entire system of American democracy begins from a position that notionally would have raised Hayek’s hackles about an incessantly litigious system in which liberty has to be constantly discovered in the finite meaning of fixed words rather than in the infinite potential of precedent and, as yet, unwritten individual common law judgements.  Hayek avoided that controversy, and referred to the US, in the 1940s, as the ‘unknown civilisation’.

Perhaps it is no longer quite so unknown, and more of a certainty as an absolutist threat to liberal values in its present tendency towards autocracy.

The problem of democracy

The rule of law, existing to protect individual liberty within a framework of representative democracy, does not prevent the risk of state tyranny via popular will, as was anticipated by Mill, when he warned about the tyranny of a majority imposing its views on minorities.  In a contemporary context, this would imply a liberal tendency to oppose populist politics altogether, and to be particularly wary of political platforms or policies that propose interventions on the sole or major grounds that they are favoured by a supposed or proven majority of citizens.

This is not a new problem for democracy, and liberalism does not have a novel solution for it, but it is a relevant concern in a political environment in which political parties increasingly rely on opinion polls to inform their policy platforms.  The only restraint on the willingness of politicians to promise completely unrealistic bribes appears to be the constraint of resources, and the level of protest they encounter when they step over an invisible but existing line of acceptable redistribution.

The only other brake on such unprincipled pork barrel politics is open and vigorous debate, which might be said to be increasingly absent.  This appears to be a consequence of another factor in the shift of political and economic power from states to private corporations that Hayek, and his critics, have been silent about: an assumed minimum intellect and education as a precondition to ‘understanding’ the concepts underlying liberalism, the value of its principles, and the necessity of resisting short-term benefits for the ‘greater good’ over the longer term.

Education: the neglected prerequisite

The less intellectually inclined, less well-educated are going to be at a distinct disadvantage in any debate about political and social ideas, and likely to remain unconvinced or even actively opposed to resisting short-term benefits or threats to liberty.

Hayek’s answer might have been contained in his own leaning towards the activism he saw as necessary to counter the twin threats of socialism and nationalism.  It seems that the relevance of that activism was never diminished, would have been of enormous value in combating the anti-communist witch-hunts of the 1950s, the ‘useful idiots’ anti-capitalism activism of the 1960s and ‘70s, and remains today as the only major intellectual tool (given the intellectually flaccid state of left critique) for publicly and systematically opposing authoritarianism of the capitalist or theocratic kind.

This does not address another factor pertaining to education: the ideological surrender of most of our academies to a left-leaning but intellectually profligate and politically impotent orthodoxy.  Roger Kimball, in his very readable polemic, The Long March: How the Cultural Revolution of the 1960s Changed America, quotes philosopher Paul Oskar Kristeller thus: ‘One sign of our situation is the low level of our public and even of our academic discussion.  The frequent disregard for facts or evidence, or rational discourse and arguments, and even of consistency, is appalling’ (p 9).  Scruton makes the point a little differently, arguing that most intellectuals are of the left, and ‘because intellectuals effectively set the terms of political debate, both inside and outside the universities, they are able to make it seem as if all disputes are internal to the socialist program’ (p 222).

John Maynard Keynes (l) with FA Hayek.
John Maynard Keynes (l) with Harry Dexter White.

Within these parameters it might be argued that much public debate in the West, conducted by and for interested and literate people, tends to become a self-censoring, or at least self-perpetuating gestalt perspective that denies the legitimacy of critique originating from outside itself.  This is particularly the case because the gatekeepers of public debate, being journalists, editors, politicians and public officials, are likely to all be the products of the education system that promotes this Weltanschauung.  Linked to this tendency is a concept about ‘right-thinking’ political actors mentioned earlier in connection with Skidelsky’s exposition of Keynes’ views on state intervention.  Extending this notion of right-thinking to encompass the liberal notion of neutrality about ends in assessing a dispute or argument, the idea of right-thinking or fair-minded people as being a fundamental pre-requisite in making political judgements has been stood on its head by the left biases mentioned above.  Not only can it no longer be assumed that academic arguments are at least subject to the methodological scrutiny of evidence and fact, but there have been notorious cases of fabrication in public debate by left-leaning agitators, and a shocking dearth of intellectual discipline in party-political debate.

It seems bitterly ironic that the ideological opponents of the left are thus offered a free pass from having to make any but the most cretinous defences of their positions.

Perhaps even worse than the left academic orthodoxy is a completely anti-intellectual trend in a growing ignorance about political, social and economic issues altogether, fostered by an increasing trend to turn universities into vocational certification bodies for a monetised apprenticeship into certain professions, all without ever touching on education at all.  The products of such a system then go on to exercise enormous economic, social, and political power from positions of astonishing ignorance about history, politics, economics, and especially ethics.

The conservative connection

In portraying the social contract of Hobbes and Locke as lacking the compelling power to inspire obedience to its spirit and concrete legal realisation, Scruton makes an effort to propose a theory of social membership that does create motive power for the subjection of self-interest to communal or social benefit tests.

In that context Scruton’s otherwise alarming prescription of an almost jingoistic, elitist patriotism rings true:

It is true that membership is a form of spontaneous order. But it is radically different from, and often in conflict with, the spontaneous orders studied by Hayek. It comes to us with imperative force. For some it has a religious meaning; for others it speaks of home, neighborhood, language, and landscape. Where the experience of membership is absent society fragments into families, gangs, and clans, as in Africa today. And there is no instance of a catallactic order in the modern world that does not depend upon national loyalty – a loyalty that may very well be threatened by too great an emphasis on the free and sovereign individual (p 225).

And:

The motives of membership are love, gratitude, and fear – love of country, language, neighbors, family, religion, customs, and home, gratitude toward these things as the source of life and happiness, and fear of their dissolution and of the anarchy, enmity, and predation that would then ensue. All of those feelings flow into a common reservoir of loyalty, which maintains the community in being and overcomes the problem of the “free rider.” For some this loyalty takes a religious form – the loyalty of the “creed community,” as Spengler called it. For others, who have passed through the Enlightenment experience, loyalty is directed to the nation and the homeland. Others still lack the feeling altogether, and identify themselves as in some way outside the society by which they are nevertheless surrounded and on which they depend for their groceries. Loyalty brings the capacity for sacrifice. And sacrifice means the preparedness to lose control of your budget, to cease to maximize your own utility, to lay down your life, in extremis, for your unknown friends (pp 225-226).

These words encapsulate a personal, sentimental, intuitive reaction to society that cannot be attributed to a particular doctrine of action or statecraft.  Somewhat ironically it is easy to sympathise with someone needing the ‘groceries’ and companionship, but inclined to scoff at those who speak about gratitude, religion, countryside, neighbours, etc.  Such people nevertheless represent an opportunity for companionship and common causes.  It is, as Scruton suggested, that:

Membership brings a vital piece of knowledge to those joined by it, namely knowledge that they are so joined, and therefore can trust each other. From that knowledge the catallactic process can begin (p 227).

Scruton’s concept of social membership, like Hayek’s thinking on liberty, defies neat categorisation or elaboration into a precise mechanical schema, but is no less powerful for it.  It is a persuasive model for deriving context about otherwise abstract engagements in human interactions.  Whether it is necessarily a conservative conception, giving comfort only to conservative conclusions, is a matter of debate.

However, current politically correct, progressive thinking is far more unforgiving about the ends of society, seeking highly prescriptive, legislated interventions into private lives to force conformity of habit and speech, if not also thought.  Legislated discrimination to address unregulated discrimination is one example.  Laws to make some speech punishable for being ‘offensive’ is another.

In that regard it might be said that not only is the contemporary ‘left’ missing in action, but its successor has inculcated only its more autocratic doctrines, and liberalism is far more likely to succeed in its objects in an alliance with principled but not ideologically closeted conservatives.

It is compelling to suppose that Hayek would have been as appalled by the anti-intellectual profligacy of allegedly progressive politics as the barbarian nihilism of the nominally free market right that appear to dominate contemporary politics.



Notes

Feser, Edward, ed. The Cambridge Companion to Hayek. Cambridge: Cambridge University Press, 2006.

  • Skidelsky, Robert. ‘Hayek versus Keynes: the road to reconciliation,’ pp 82-110.
  • Kukathas, Chandran. ‘Hayek and liberalism,’ pp 182-207.
  • Scruton, Roger. ‘Hayek and conservatism,’ pp 208-231.

[1] It is presumptive to associate the term ‘liberal’ with practical political proposals for extreme economically rationalist policies, particularly in the absence of any other signifiers of liberalism attached to either those policies or their proponents.  It is equally presumptive to declare any political action agenda ‘neoliberal’ just because it contains elements of classically liberal ideas.  It can be forcefully argued that there is no such thing as neoliberalism, because the liberal school of thought has not yet disavowed or abandoned liberalism’s fundamental ideas, and their appropriation into party-political agenda is not evidence of a revisionism so much as pastiche or eclectic pragmatism.  In that regard it is interesting to speculate whether Hayek would have considered neoliberal a ‘weasel word’ in the same vein as ‘social justice’.

[2] There is reason to suspect that Hayek regarded the Nazis as a particularly confounded variant of socialism rather than the singular form of fascism it is thought of today.  There is, for example, the very name of the National Socialist Workers Party (Nazi party for short) as an indicator.

[3] This non-state influence on states and societies is the subject of many other studies and commentaries, not least Noam Chomsky’s ‘Manufacturing Consent, and the documentary films of Adam Curtis and Michael Moore.

[4] In this context, ‘libertarian’ has a specific philosophical and historical definition far removed from its use in US politics.

 

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