It is a measure of how far we have travelled in the world of ideas that the case for state central planning, as was once championed by British Fabian socialists and similar people 100 years ago, struggles to get a respectable hearing these days. That is not to say that the idea is dead, merely that it has been subjected to a sustained intellectual and practical hammering, not least the fall of the old Soviet Union.
One person who has the good sense to realise how discredited central planning has become is the American leftist writer, Jesse Larner. Who deserves some of the credit? It is a certain FA Hayek, he says, telling this to readers whom, one imagines, might have called for his defenestration by saying anything nice about Hayek only 20 or 30 years ago. The article, which focuses on Hayek’s early book, The Road to Serfdom, is fairly respectful of the case against central planning, and one might hope that this shows that parts of the left have fully grasped the folly of said. But there is a lot left in this article that is misleading, besides-the-point, or which misses some crucial points. In a way, the muddle of this article explains perfectly the mindset of what can be loosely called the left today, and yet is also suggestive of how libertarians might yet be able to engage with the smarter of them and bring them over to our side. So I have decided to take a look in some detail. Let’s start with this:
Politically, Hayek is not the cynic I had braced for. Plainly, transparently—and in stark contrast to many modern conservative intellectuals—he is a man concerned with human freedom. One of the unexpected things in Road is that he writes with passion against class privilege.
That is very revealing of the circle that Mr Larner keeps. He is amazed, apparently, that a guy who defends the free market order is not a political “cynic”. Well, if by cynicism one means a low view of those who seek to attain by power and influence what others do by enteprise and hard work, I guess he has a point, but that hardly is a sin in my book. Also, Mr Larner should have read enough right-of-centre authors to know that liberty is actually a regular concern. One of the very reasons why there was a counter-movement against socialism after WW2, from all those think tanks and academics with those strange central European surnames like Mises and Polanyi, was precisely because they saw, in socialism, the loss of liberty.
Here’s another one:
Indeed, he is often eccentric. He is a romantic, a serious deficit in a social theorist. Many of his arguments rest on a reductionist idea of socialism, and his conception of the sources of law can only be called mystical.
But Hayek is not merely an eccentric mystic.
The only justification I can think for that remark is that Hayek was a notable defender, and explicator, of the value as he saw it of the English Common Law and the post-1688 settlement in England. He called himself an “Old Whig”, was a great fan of the legal scholar Blackstone as well such figures as David Hume, the Scottish philosopher, Adam Smith (of course) and Edmund Burke. In the case of Burke, the influence is interesting, since the great Irish politician, now mainly remembered as a scourge of the French Revolution, was a supporter of the American Revolution, moved for the impeachment of Warren Hastings, of the old East India Company, was a notable denouncer of political corruption, and was primarily a Whig, and not a Tory. It is also true that Hayek valued the Burkean notion that there is a value, not always easily grasped, to traditions that have developed across the centuries. I’ll readily admit though that this is a weakness: just because something is traditional, does not of course make it a good thing. There is, in fact, a tension between those Hayekians who praise certain traditions and those, who, from the more natural rights portion of the libertarian camp, think that we should send some traditions to the scrapheap. He goes on:
One of Hayek’s most original contributions to economic theory is the insight that economic systems are based primarily on information rather than resources. To plan an outcome and to direct economic inputs and outputs toward this outcome is to stifle the emergence of a spontaneous, democratic response to the needs of the individuals who make up the community—a response that will necessarily have winners and losers, but that will not privilege the vision or depend on the limited information of a governing elite, and that will encourage further experimentation.
That is a pretty good summary. I’m buying.
He points out that any economic master plan would necessarily have to delegate so many important issues of policy to non-elected technocrats as to be inherently antidemocratic, and that a society in which the value of goods and labor were defined according to their utility to the plan would necessarily allow no room for individual choice and subjective valuation.
Today, these observations are merely obvious. Yet it is worth pointing out that Hayek understood at least one very big thing: that the vision of a perfectible society leads inevitably to the gulag.
The absence of any consideration of more libertarian, less top-down approaches (the socialisms of Luxembourg, Kropotkin, Proudhon, many others; or of the possibility of nontotalitarian models of social democracy, like those that emerged in Europe after the war) should alert the reader to Hayek’s limitations. Admittedly, Kropotkin’s ideas had little impact on the world of 1944, Stalin’s a great deal.
That comes across as a bit disengenuous. I guess Hayek probably did know about these other, “bottom-up” forms of socialism, but as he, and his mentors like Ludwig von Mises pointed out, such “libertarian socialism” is an oxymoron since it ignores whether a member of a “voluntary” commune would be allowed, in practice, to leave with his or her share of accumulated capital and strike out on their own. If the answer to that is yes, then you would quickly find quite a lot of ex-commune dwellers reverting to old-fashioned entrepreneurial capitalism. If these “bottom-up” socialists prevent this, or demand that the profits of the break-aways be wholly or partially confiscated, it is hard to avoid the conclusion of the late libertarian philosopher Robert Nozick that socialism involves the preventing of capitalist acts between consenting adults.
Mr Larner trudges on:
Hayek doesn’t seem to grasp that human beings can exist both as individuals and as members of a society, without necessarily subordinating them to the needs of an imposed social plan (although he acknowledges that the state can legitimately serve social needs, he contradictorily views collective benefits as incompatible with individual freedom).
That is not right at all. Hayek wrote a lot about traditions, the benefits of inheriting cultural values via institutions such as the family, and so on. He certainly did not think if collective benefits of things like laws and defence of freedom as clashing with liberty; in fact he made it abundantly clear that law and liberty were intertwined.
He rejects the very concept of social justice, for much the same reasons that he rejects the arbitrary valuation of labor: in Hayek’s view there is no way to put an objective value on a grievance or to weigh it against other claims. And because he locates all responsibility and agency only at the level of the individual, he sees no way in which any claim can be generalized to society.
He did reject it, for the very reason – as Mr Larner knows perfectly well – that is a question-begging term. Social justice requires, as a premise, that wealth somehow exists “out there” and that the collective of humanity has some prior claim to said. But that puts the cart before the horse, as Hayek explained. He also pointed out that terms like “social justice” smuggled egalitarian, illiberal concepts into more neutral terms, and this was a pernicious thing, since it disabled clarity of thought.
Perhaps it is because of this outlook that Hayek does not, in Road, address collectivism as a spontaneous, nongovernmental, egalitarian phenomenon.
He probably does not address it as, to the extent that any collective effort involving more than one person is freely undertaken by said, there is no need for it to be addressed. Individuals band together to form foundations, charities, firms, clubs, whatever. So long as they are free to leave and their property is not seized, what is the issue? There is not one. What Hayek was against was coercively shoving people together into collectives not of their choosing.
Even a brief survey will show that there are all kinds of imaginative ways in which libertarian collectivism can coexist with capitalism and markets.
If that is true, what is the problem? People can and do share ideas for free – as on the internet – or band together to form common cultural, economic and political groups all the time. This is the paradox of a liberal society; far from being a cliched world of individuals pitted against each other in a war, a free society allows enormously complex and rich examples of co-operation. The market is, in fact, the most remarkable example of co-operation that there is.
It is a bit chilling to read the words of the British socialists quoted by Hayek—E.H. Carr, C.H. Waddington, Sir Richard Acland, H.J. Laski—who, when Hayek wrote, were calling complacently for what can only be read as an enlightened totalitarianism, even in the shadow of Hitler. And Hayek is very convincing, and most interesting, when discussing the romantic roots of German antiliberalism and of the illiberal statism of the left and right. But this does not mean that public disbursements in the social interest necessarily start us down a slippery slope to the totalitarian state, and Hayek, in suggestively conflating government spending with government planning, pulls a bit of a sleight of hand in Road.
Well I do not know. I think that although the direction of socialism that Hayek predicted may not have been entirely accurate. But Larner is surely missing a point that frequently exercises the likes of us at Samizdata: what might be called the regulatory form of socialism. Under this form, one might nominally own a house, or a company, or whatever, but there are so many rules telling you what to do that you might as well have nationalised ownership. This is a much harder form of socialism to fight. I am certain that Hayek would have addressed this issue. He would have been horrified by the loss of civil liberties in Britain and the constant demand for a government “solution” to this or that problem.
There are glimmerings of respect for Hayek here in Mr Larner’s article, and this is by far from being the worst left-of-centre review of Hayek that I have read. Mr Larner clearly respects what the great Austrian thinker stood for, and has the good grace not to engage in gratuitous name-calling. But there remain problems. Oh well, this is the sort of person that libertarians need to patiently cultivate.