The Blonde Beast in the Boardroom

10 May

A familiar left-wing critique of libertarianism and the wider school of classical liberalism is that it defends only formal not actual freedom. Everyone is formally free to accumulate property because the law protects everyone’s property rights in whatever they have acquired legally. In practice this means some end up with much more property than others, leaving most people economically dependent on the wealthy few. In fact, a person’s formal freedom to own things is consistent with him not actually owning anything at all. The defense of formal freedom is therefore a particular way of concealing and reproducing radically inequality, in the name of equal freedom itself. There are endless refinements and variations of this argument, but it is the basic and long-standing left-wing critique, and it continues to have strong appeal today as an argument against the current distribution of wealth and income.

This week, Corey Robin published a remarkable and decidedly different take on the inegalitarian features of modern libertarianism and its marginalist origins. On Robin’s view, there is nothing concealed or even mysterious about this intellectual tradition. It is explicitly and self-consciously inegalitarian. In a passage worth quoting at length, Robin unpacks the aristocratic seeds of Hayek’s worldview

In fact, Hayek continues, it is not really my freedom that I should be concerned about; nor is it the freedom of my friends and neighbors. It is the freedom of that unknown and untapped figure of invention to whose imagination and ingenuity my friends and I will later owe our greater happiness and flourishing: “What is important is not what freedom I personally would like to exercise but what freedom some person may need in order to do things beneficial to society. This freedom we can assure to the unknown person only by giving it to all.”

Deep inside Hayek’s understanding of freedom, then, is the notion that the freedom of some is worth more than the freedom of others: “The freedom that will be used by only one man in a million may be more important to society and more beneficial to the majority than any freedom that we all use.” Hayek cites approvingly this statement of a nineteenth-century philosopher: “It may be of extreme importance that some should enjoy liberty…although such liberty may be neither possible nor desirable for the great majority.” That we don’t grant freedom only to that individual is due solely to the happenstance of our ignorance: we cannot know in advance who he might be. “If there were omniscient men, if we could know not only all that affects the attainment of our present wishes but also our future wants and desires, there would be little case for liberty.”

As Robin tells it, this vision of everyone’s freedom only gaining value through the heroic efforts of the few who use it to create new values can be traced back to a surprising source: fin-de-siecle Vienna, and in particular the subterranean cultural and social philosophical connections between Nietzsche and the marginalist economic revolution. The article is not easily summarized. It traces unexpected connections and elective affinities, but the basic point is that seeing value as subjective, and seeing freedom as an act of choice that endows goods with value – the basic, boring, seemingly value-neutral starting point for modern microeconomics – has to be understood as not just a methodological but a cultural and political revolution. It became, in the hands of figures like von Mises, Schumpeter and Hayek an argument for why neither art nor politics but the market was the real site for the creation of value, in which a few heroic figures exercised their virtues and reinvented culture, while the masses made the free choice to be led by the captains of industry.

Moreover, it was a way of turning political questions about human needs into millions of isolated ethical dramas, played out separately in the market. Here again, a passage from the article is worth quoting at length:

For those choices to reveal our ends, our resources must be finite—unlimited time, for example, would obviate the need for choice—and our choice of ends unconstrained by external interference. The best, indeed only, method for guaranteeing such a situation is if money (or its equivalent in material goods) is the currency of choice—and not just of economic choice, but of all of our choices. As Hayek writes in The Road to Serfdom:

So long as we can freely dispose over our income and all our possessions, economic loss will always deprive us only of what we regard as the least important of the desires we were able to satisfy. A “merely” economic loss is thus one whose effect we can still make fall on our less important needs…. Economic changes, in other words, usually affect only the fringe, the “margin,” of our needs. There are many things which are more important than anything which economic gains or losses are likely to affect, which for us stand high above the amenities and even above many of the necessities of life which are affected by the economic ups and downs.

Should the government decide which of our needs are “merely economic,” we would be deprived of the opportunity to decide whether these are higher or lower goods, the marginal or mandatory items of our flourishing. So vast is the gulf between each soul, so separate and unequal are we, that it is impossible to assume anything universal about the sources and conditions of human happiness

On Robin’s striking reading, difference and inequality are the essence of the ideology, not aspects concealed by a formal commitment to the freedom and equality of all persons. There is much more to say about the article, but it is worth noting two things in particular. First, both the left and libertarians often note that the myth of the market fails to correspond to reality. If anything, libertarians see this better than the Left, the latter often taking free market ‘neoliberal’ ideology to describe reality – something we were reminded of in recent Thatcher obituaries. But Robin’s article suggests a different reading. Practice does match ideology if we stop thinking of this ideology as a thesis prescribing perfectly free markets, limited regulation, with low barriers to entry, fully rational actors, and the rest of it. Robin instead invites us to see the heart of the ideology as an argument about the market as an sphere of agonistic struggle, in which the few battle it out in a contest of wits, foresight and pure will, while Hayek’s “great majority” use their freedom for considerably more mundane purposes.

Second, the left has often taken issue with the seemingly bourgeois or rationalistic assumptions of neo-classical economics and its marginalist forefathers. It has attacked its individualism and its scientism. But Robin makes us see the passionate cultural and political side of some of the markets most ardent defenders. Their intellectual roots lie just as much in a kind of inegalitarian cultural anxiety, irrationalism, and celebration of the will as they do in the dull grey-in-grey of the dismal science. Keynes was not the only one interested in animal spirits, though in this case, the animating spirit is the blonde beast in the boardroom.


3 Responses to “The Blonde Beast in the Boardroom”

  1. Mara May 10, 2013 at 9:02 pm #

    Hayek:“If there were omniscient men, if we could know not only all that affects the attainment of our present wishes but also our future wants and desires, there would be little case for liberty.”

    Here then is the thin white line separating our warlord-capitalist society from regression to pure slavery, the two obvious forms of social organization to an Austrian: We agree to allow a drop of freedom (qua the market commodity money) to many—that is, to pay wages—instead of promoting Great Men on the backs of pure slavery, as insurance against the risk that a Great Man’s imposing will might emerge from amongst the unwashed hordes.

    What tight-holed romanticism is this! Given the laws of probability, a capitailst Ghengis Khan could arise; therefore, let freedom trickle down! And yet at the same time, how maternally this pinched romanticism protects the feeling, beating like an anxious bird within the breast, that the Great Men must issue Greatness by virtue of that nimble dancer, inherent merit.
    Robin’s clarifying thesis, that the self-described rational projects of capitalist Serious People are animated by a particular set of emotions is a characteristically deft leftist redirection, respecification of an otherwise blunt, conservative bourgeois (Burkean) intellectual pursuit, strategically valorizing emotion above a discredited rationality. We have heard quite a lot over the recent decades about how rationality is merely an Enlightenment or modernist construction, a conceit, committed principally by people who explicitly promote egalitarianism (including a variety of ‘egalitarianism’, autistic individualism), or so we assume. It is a point of classic conservative thought widely accepted.
    This ‘modernist’ framing/discrediting prevents us from grasping how conservatives—people who explicitly and consciously promote inequality, whose culture includes capitalism, affirms its slavery complements, and reaches back into other steeply hierarchical social orders– are galvanized by some particularly prickly and adamant emotions, which you’ve sketched above.
    The ‘modernist’ framing unfortunately also directs us to fetishize post-Hapsburg Austrian culture as an historical break, when clearly, the disintegration of the Empire was felt in Austria as a tragic (but not necessarily permanent—These people believed in Greatness, in cycles, in politics) loss of Greatness in the world. What distinguishes the Austrians and their political-economic and cultural legacy to the world is that they sought to disinter, to resurrect, to restore, to redeem the Empire. Unlike egalitarians, they did not seek to aufhebung anything but the Decline (of the Empire, of Greatness). With all due respect to great contemporary theorists of modernity, I disagree with the effort to confound this Austrian tendency, which transplanted to the receptive socio-ecosystem of England and from there grew without serious predators, a beloved invasive embedding within the hearts and synchronizing the pulse of conservatives and Neoliberals alike, flowering everywhere as TINA.

  2. brucemajors May 11, 2013 at 2:12 am #

    I’m always amused by the enormous ignorance of leftovers, who don’t know their own scholarship. Socialist historian Gabriel Kolko produced several masterful works showing that the new deal and progressivism produced more inequality and poverty, as established corporations used government to protect themselves from upstart competitors.

    Today leftovers attack and evade all education reform, protecting the educrat cartels that in America donate money to the Democratic candidates for every poor, usually black, child sold to them. You leftovers are running the contemporary world’s biggest race slave trade. And then you babble on moronically about the evils of individual liberty. You are too pathetically stupid and morally cloacal to consider as worthwhile for conversation..

    • Joe Miller May 11, 2013 at 8:02 am #

      Why bother commenting, then?

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