Hayek’s Absolutism

Hayek lived long enough to see his ideas ascendant in western politics, which was something of a gift; perhaps it was an equally valuable reward to have missed the bit when it all went pear-shaped.

In reading several articles on Friedrich Hayek recently, two words kept coming to mind: absolutism and elegance. Hayek appears to my inexpert reading to have been a highly scientific thinker, one with a good degree of faith in the scientific method. Attached to this is a consciousness of the sublime, a sense that there is a truth to be found in thought, an awareness of a tangible human goal of understanding. There is, in other words, a destination for our species.

This is at least partially a human thing – the alternative being a Nietzschean dystopia of nihilism and emptiness – and there is some resignation attached; belief in existence is essential to being human. It’s not ‘clever’ to think that existence isn’t real, it is entirely pointless. Denying it as a possibility is hubris, perhaps; but it is also extremely tempting. We must theorise about our existence not because it must have meaning in some abstract sense – that’s for the Churches – but because it must be real. Once we accept that existence is real, then truth becomes attainable. Truth itself has an attractive (elegant) quality in an aesthetic sense, but scientific truth bears an attractiveness of its own, in its reflection of ourselves, our conceits, and our view of the world.

Bertrand Russell saw beauty in mathematics, where he says ‘[t]he true spirit of delight, the exaltation, the sense of being more than man…is to be found in mathematics as surely as it is in poetry.’ Elegance, then, in a proof, or an equation, shows a balance that is natural. It serves as confirmation of our fundamental beliefs (such as the laws of physics) and our sense of ourselves. It is an entirely seductive force, and difficult to set aside. Where we find elegance in theories, therefore, they become difficult to modify. Which is what brings us to absolutism in our defence of those ideas.

Hayek’s interpretation of the human condition was that of natural man, a product of nature, a measurable and predictable creature. He believed that natural human needs and desires formed our current civilization through what he described as a spontaneous order. That foundational principle, and its attendant assumptions, has underpinned his philosophical, sociological and economic work. Spontaneous order is not one designed by humans, but one that arises based on human action. It is the product of evolution, a Darwinian assessment of sociological formation. Within that order lies the price mechanism, the result of a negotiation between man and his environment, in much the same way as language had come about.

Hayek’s absolutism comes into play when his theory is applied to economics, or rather when his theory requires that economics trumps our understanding of sociology, politics, anthropology and perhaps even history. It is certainly true that political structures including state, law, and democracy are entirely anathema to Hayek’s philosophy, as dangerous ideas that lead to totalitarianism. The very concept of values, something that politicians often talk about, is essentially wrong, in Hayek’s view; values are essentially relativist nonsense. In simple terms, for example, this undermines Marx’ Labour Theory of Value, arguing that to associate one bunch of energy (labour hours) with another (a commodity) is merely arbitrary. That in turn takes down the entire Marxian edifice. It similarly undermines the concept of social justice (The Mirage of Social Justice, 1976), as ‘an empty phrase with no determinable content.’

The imperfections of Western Liberal Democracy are clear, particularly in its hypocrisies. Failures in law and equity, in wealth and income inequality, and in our expectations of government in terms of social supports all contribute to an uneasiness about the righteousness of government, and contribute to the cynicism and apathy that characterise parts of many mature democracies. Trump and Brexit are obvious recent examples, but the rise of the far right in Europe, and the decline in voter turnout in all but the most combative elections and divisive referenda indicate deeper lying problems. There is a disassociation from state and society that appears to be growing as a trait of modernity, accompanied by the narcissism of reality TV and so-called ‘celebrity culture’. The state and society are things to be avoided, to be manipulated or played. They are no representation of a common social vision, or a kind of national soul, but of a narrow elitist worldview. It is easy in such circumstances to understand Hayek’s rejection of social justice: even with the best of intentions, it ends up in an essentially arbitrary redistribution.

Hayek had studied Feuerbach as a young man, whose work on alienation I’ve written about here recently. I’ve not seen reference to Feuerbachian alienation and its influence on Hayek, but it appears to me that the development of Hayek’s concept of spontaneous order owes at least a partial debt to him. Feuerbach argued that religion essentially creates inequality, between God and man in the first instance, and more generally a separation between man and his essential self, what Feuerbach called his species-being. For religion, in Hayek’s twentieth century worldview, we see industry and state, extending inequalities and constructing social orders that are alien to essential (individual, liberal, unfettered) humanity. Social justice therefore, in Hayek’s reading, is a mirage. This constructed order, this non-spontaneous order, is based on a set of values and beliefs manufactured by men and imposed upon other men as the price of citizenship. This can only lead to totalitarianism, which Hayek absolutely rejected.

Stephen Metcalf’s recent and thoughtful piece in the Guardian on neoliberalism bears a further reference here. He observed that Hayek’s neoliberalism ‘was pregnant with the thing it was said to protect against,’ that the inevitable ultimate rejection of neoliberalism would birth the totalitarian demagogue. I’m not sure that’s necessarily true – that totalitarianism would be an inevitable consequence – though I do sense that neoliberalism bore weaknesses, with the benefit of hindsight, that would require some kind of alternative to replace it. Perhaps it’s just an irony, the way things are turning out.

The totalitarianism of the mid-twentieth century that informed Hayek’s thinking involved not just people who believed in extreme ideas, or strongly alternative ideas, or radical ideas, but for Hayek it was much more simple than that: these were just people who believed in ideas. All ideas, in Hayek’s view, lead to totalitarianism because the lines drawn by idealists are subjective, arbitrary and relativist. The transition from Keynesian statism to Hayek’s neoliberalism has required essential compromises. Two great State-defining institutions in the United States and the United Kingdom – the US Military and the National Health Service in the UK – are massively outsourced, but each remains tethered to the National Government. Econometricians stride the halls of government, counting, calculating and estimating, while analytics and statistics drive all decision making, yet those decisions remain exercised within the structures of electoral democracy.

Hayek’s vision, however, sees no end; for its value lies in its absolutism: Hayek’s economics don’t merely describe trade and commerce, but the nature of humanity. Any deviation from that model, any validated ‘non-economic sphere’ fundamentally attacks the underlying theory of spontaneous order. To understand Hayek, and to appreciate his influence, this is where he stands or falls. It is a theory of human political evolution, and either he’s right – and everything is a market, price signals are quasi-divine messages, and social justice reflects idealistic and irrational expectation – or he’s wrong, and the whole basis for of modern Western Liberal Democratic government falls. That may have already happened, in 2007/8. If that is indeed the case, then our way of life is living on borrowed time.

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