If socialism is the road to serfdom then liberalism is the road to freedom. Friedrich Hayek is famous for defining freedom in negative terms. A person is free when they are not coerced. Left liberals define freedom in positive terms. A person is free when they have the ability or power to do what they want. At least that’s the conventional distinction. And like many conventional distinctions it conceals as much as it reveals.
At Larvartus Prodeo Anna Winter writes, "’Liberals’ on both sides of this debate would do well to consider the similarities we share, and to focus on the ends that we have in mind." I couldn’t agree more. As I’ve written elsewhere, Hayek’s version of classical liberalism is far closer Rawls’ version of egalitarian liberalism than most people realise. Here’s Hayek’s vision:
…we should regard as the most desirable order of society one which which would choose if we knew that our initial position in it would be decided purely by chance (such as the fact of our being born into a particular family). Since the attraction such chance would possess for any particular adult individual would probably be dependent on the particular skills, capabilities and tastes he has already acquired, a better way of putting this would be to say that the best society would be that in which we would prefer to place our children if we knew that their position in it would be determined by lot (p132).
The Hoover Institution’s Kurt Leube sums up Hayek’s intent in a sentence: “Hayek sees its main task as that of finding rules to enable men with different values and convictions to live together. These rules should be so constructed as to permit each individual to fulfill his aims” (xxv). The sticking point in interpreting Hayek is whether we should say ‘permit’ or ‘enable.’ It seems obvious to me that Hayek’s vision implies a set of rules that maximise every person’s opportunity to live the kind of life that they want to live (p 126).
In a number of places Hayek acknowledges that government has a role in providing services that would enable individuals to achieve their aims. For example, in his 1976 lecture ‘Socialism and Science’ he said:
Strong reasons also exist for wishing government to render outside the market various services which for one reason or another the market cannot supply. But the state certainly ought never to have the monopoly of any such service, especially not of postal services, broadcasting, or the issue of money.
Classical liberals and libertarians like to fudge the distinction between permitting and enabling because it helps maintain the fragile coalition between libertarians and classical liberals like Hayek and James Buchanan. Natural law libertarians like Murray Rothbard value freedom for its own sake. For them, rights are primary. But for Hayek, rights are a means to an end. If we assume than nobody’s aims matter more than anybody else’s then we need to find a system of rights that maximise everyone’s opportunity to achieve their aims.
Returning to Anna’s point about focusing on ends, it seems to me that left liberals and Hayekian liberals have a lot in common. The focus of the dispute between the two groups is economics and social science rather than philosophy. Left liberals worry that freer markets will hurt the chances of the worst off. They want governments to step in and offer services like health and education as well as protecting vulnerable citizens from coercion by employers, landlords and other powerful market players. Hayekian liberals worry that government intervention will cripple markets. The resulting inefficiencies will mean less for everyone — including the worst off. They worry that governments will be captured by powerful interest groups and that democracy will mean one group telling another how to live.
Part of the reason we’re not having this debate is that Hayekian liberals have been captured by their libertarian allies. When socialism was a real threat it made sense for Hayek’s followers to ally themselves with natural law libertarians, conservatives and even Objectivists. But now the tail is wagging the dog. One example of this is the issue of coercion that doesn’t directly involve government.
According to Hayek, coercion doesn’t need to involve threats of force or violence. To coerce somebody all you need to do is manipulate the situation so that the behaviour you want becomes the person’s least painful option. According to Hayek, coercion can include blackmail, harassment, and even nagging. In The Constitution of Liberty he writes that, "a morose husband, a nagging wife, or a hysterical mother may make life intolerable unless their every mood is obeyed (p 138)." Not surprisingly, he believed that it was impossible to completely eliminate coercion. And he certainly didn’t think that the state should do any more than it does already to regulate behaviour within marriage.
Hayek recognised that it wasn’t just government that could engage in coercion. If a business owner has a monopoly on the supply of some essential service like water they may be able to coerce customers. In such extreme cases he suggested that government could step in to prevent the monopolist from acting in an arbitrary way — to insist that they charge everyone the same price and not discriminate (p 136).
Murray Rothbard was appalled by this. He could see quite clearly where it would lead. There’s a good argument for saying that Hayek hadn’t fully realised what his own principles require.
American philosopher Elizabeth Anderson is a particularly incisive critic of Hayek’s work. She argues that "A pure system of natural property rights with unrestricted freedom of contract contains inherent tendencies to revert to feudalism if the state does not limit freedom of contract by restricting property transfers from the desperate to the well-endowed." For example, imagine a single mother whose disabled child needs constant costly care. Imagine also that she has no savings and no real choice of employment. Her employer can treat her however he feels like. For example, he might insist that she flirt with customers, put up with constant humiliation and harassment and perhaps even sleep with him and his friends. Just as citizens in a dictatorship are at the mercy of the good will of their ruler, an employee in a ‘feudal’ relationship is at the mercy of the good will of their employer.
Anderson gets to heart of what is wrong with this kind of relationship:
Feudalism, whether contractual or not, is objectionable because it constitutes a relation of personal subjection, in which one party enjoys arbitrary power over another. Because personal independence is essential for liberty, it should be considered an inalienable right.
Because Hayek argues that coercion is a matter of degree, he has no in-principle defence against claims that governments need to protect vulnerable citizens from coercion from employers and other powerful market players. After all, here’s how he explains the nature of a coercive relationship:
Coercion implies… that I still choose but that my mind is made someone else’s tool, because the alternatives before me have been so manipulated that the conduct that the coercer wants me to choose becomes for me the least painful one (p 133).
The idea here is that one person has become to tool of another. This is against everything that liberalism stands for. For liberals the attraction of markets is that enable people with different goals to work cooperatively together. As Adam Smith saw, the butcher or the baker wants to provide for her family and her customer wants to provide for his. By entering a market relationship both are able to achieve their own goals.
Hayek was right to say that the only road to freedom is through law. The only question is, what those laws should be.