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February 2, 2005
A new journal devoted to Hayek. It is good to see, as he is a serious and influential political thinker whose philosophy underpins a neo-liberal market order.
From my perspective the weakness of Hayek is the polemical Road to Serfdom. It is a polemical text that speaks to a moment of history the 1940s and the period of central planning and totalitarianism that has little purchase on social democracy. Social democracy split the tight identity between planning and totalitarianism argued for by Hayek.
In contrast, one strength of Hayek is his critique of scientism in the social sciences, and his critique of a Cartesian deductive mathematical reason that has so dominated neo-classical economics, with its contempt for history, and its tendency to shape reality according to the dictates of utopia as a purely competitive market. With this move Hayek opens up a space for other kinds of rationality.
This was my pathway into Hayek and one that few 'economic rationalists' in Australia appear to have taken. It pushes to one side the view that policy formation and decision making is primarily economic, and that political problems can be solved by economics. This then opens up a space for the political and the philosophical in policy making. So policy making shifts to how does a liberal state govern a population through the dispersed knowledges, economic processes and spontaneous order of the market.
The shift that Hayek makes is to constitutional liberalism based on individual freedom and limited government, and he argued that this is what underpined the American constitution. Does it? Is that an accurate reading?
What is not clear to me is the connection between Hayek's idea of the market as a spontaneous evolutionary order arising from the unentneded consequences of free actions and his constitutional liberalism. Is not constitutional liberalism designed and imposed by political authority as the sovereign? Is that it not a constructive rationalist liberalism--the wrong kind of liberalism? So how does the spontaneous order in civil society relate to constitutional order?
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It is interesting to compare Hayek's critique of central planning with what Adorno and Horkheimer say about it in Dialectic of the Enlightenment, which came out at the same time. For Adorno and Horkheimer, the problem with planning is metaphysical -- the logic of organization leading, eventually, to planning for its own sake, analogously to the Sadeian orgy. Hayek's problem was always that he wanted central planning to be distinguished from the legal transformation of the property relation that characterized the advent of capitalism in Europe, and the colonial imprint on India. This is a false division -- when the utilitarians in the India office re-wrote the property laws in india and made land ownership fungible, the effect of this, and the mechanism for it, was really no different than Stalin's collectivization of farmland in the Ukraine. In both cases, cultures (and millions of people) were destroyed by a small group of governors in the name of a political ideal.
Hayek wrestled with this distinction throughout his career, but I don't think he "found a way to get the fly out of the bottle" -- for indeed, the distinction between central planning and merely "neutral' changes to produce a society founded on the law of contract is bogus. In fact, the great fact of modern history, from the conquest of the Americas to today, is that that neutral change produces great and lasting cultural catastrophes.