Challenging Bargaining and Royalty An Analysis of Libertarian

Challenging, Bargaining, and Royalty: An Analysis of Libertarian Argumentation By Daniel Klein, Economics, George Mason University, and the Ratio Institute

The Hayekian Narrative n n n Hunter-gatherer. Society as organization. Centrally planned, hierarchical. Shared experience and sentiment. Still in our genes. Settled hierarchy, organized society Commercial revolution, extended order n n n Philosophy of liberty and spontaneous order Collectivist reaction, armed with democracy and stolen vocabulary Social-democratic hegemony, protracted cultural struggle 2

Ideological Lock-in n It is very rare that one’s ideological sensibilities change significantly after the age of 30. n To influence ideological sensibilities, you must reach the young. 3

Ludwig von Mises: “It is impossible to understand the history of economic thought if one does not pay attention to the fact that economics as such is a challenge to the conceit of those in power. ” 4

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2 Classical-Liberal Character Types n n n Classical liberals favor points within the left ” 20 yd line” Challengers and Bargainers: Both privately favor positions left > right, at least to the 20 yd line The difference highlighted here is not a difference in privately held policy views 6

Challengers n They say to the listener: Speaker B is misguided because he is statist. 7

Bargainers: n They say to the listener and to Speaker B: Speaker B is misguided, and hence more interventionist than he should be. 8

Intended effects 9

Turn, turn To every thing turn, turn There is a season turn, turn -- The Byrds How much one should turn depends on his abilities and the segmentation of his discourse situations 10

n My take on challengers and bargainers started with: Shelby Steele, The Content of Our Character: A New Vision of Race in America (1991) 11

Not to Oversell It n Some not categorized: David Hume, JB Say, Richard Cobden, Herbert Spencer, William Graham Sumner, Albert Jay Nock, HL Mencken, Charles Murray, Johan Norberg, David Friedman n To know how to categorize, it is not sufficient to read their works. n 12

Challenger Gallery n Thomas Paine – American revolutionary 13

Challenger Gallery n Frédéric Bastiat – French libertarian economist. However, as B. Baugus points out, he also sometimes bargained. 14

Challenger Gallery n William Lloyd Garrison – American abolitionist. “Upon being reproached for the habitual severity and heat of his language, Garrison retorted, ‘I have need to be all on fire, for I have mountains of ice about me to melt. ’” (Rothbard Egal. p 245) 15

Challenger Gallery n Ludwig von Mises – Austrian political economist 16

Challenger Gallery n Ayn Rand – Russian. American novelist and pop philosopher 17

Challenger Gallery n Thomas Szasz – “The Myth of Mental Illness” 18

Challenger Gallery n Murray Rothbard – Amer. libertarian polymath 19

Challenger Gallery n Robert Higgs – Economist, editor The Independent Review 20

Challenger Gallery n Walter Williams – American economist and columnist 21

Bastiat n n Highlights that the essence of government action is coercion. When private citizens do what the state does, we call it crime: n n n Makes plain that he is for the fundamental reform: n n “There are people who think that plunder loses all its immorality as soon as it becomes legal. ” (p. 29) “The state is the great fictitious entity by which everyone seeks to live at the expense of everyone else. ” (p. 144) “I confess that I am one of those who think that the choice, the impulse, should come from below, not from above, from the citizens, not from the legislator. . . ” (p. 12) Makes categorical moral arguments against coercion: n “and the contrary doctrine seems to me to lead to the annihilation of liberty and human dignity. ” (p. 12) 22

n Scorns statism: n n n “I do not know to what barbaric century we should have to return to find on this point a level of understanding comparable to that of the socialists. ” Suggests that human instinct and public opinion are systematically biased toward statism: The whole argument about the seen and the unseen. Protests the general political culture of his society: n “Good Lord! What a lot of trouble to prove in political economy that two and two make four; and if you succeed in doing so, people cry, “It’s so clear that it is boring. Then they vote as if you had never proved anything at all. ” (p. 11) 23

Argues that statism is sustained by a number of superstitions and taboos: n n “Need it be said that we may have been, in this respect, duped by one of the most bizarre illusions that has ever taken possession of the human mind? ” (p 142 -43) The inconsistent belief system: “consists in requiring everything from the state without giving anything to it. . . is chimerical, absurd, childish, contradictory, and dangerous. Those who advance it in order to give themselves the pleasure of accusing all governments of impotence and exposing them thus to your violent attacks, flatter and deceive you, or at least they deceive themselves. ” (p. 151) 24

MISES n n n Mises never had secure professional standing, and as the little he had disappeared, he became more and more challenger-ish. Highlights that the essence of government action is coercion. When private citizens do what the state does, we call it crime: n n “It is important to remember that government interference always means either violent action or the threat of such action. Government is in the last resort the employment of armed men, of policemen, gendarmes, soldiers, prison guards, and hangmen. The essential feature of government is the enforcement of its decrees by beating, killing, and imprisoning. Those who are asking for more government interference are asking ultimately for more compulsion and less freedom. ” (p. 715) However, Mises does condemn “natural law” in the sense of “a perennial standard of what is just and what is unjust” (p. 716, see also 717) 25

n Makes plain that he is for the fundamental reform: n n Makes categorical moral arguments against coercion (even though he would deny it): n n “the Santa Claus conception of government” (p. 846) Protests the general political culture of his society: n n “Laissez faire means: Let the common man choose and act; do not force him to yield to a dictator. ” (p. 12) Scorns statism: n n Indicates that he favors laissez faire (p. 725) “our age of passionate longing for government omnipotence” (p. 725) Argues that statism is sustained by a number of biases: n “All this passionate praise of the supereminence of government action is but a poor disguise for the individual interventionist’s self-deification. The great god State is a great god only because it is expected to do exclusively what the individual advocate of interventionism wants to see achieved. ” (p. 727) 26

Challengers n n n Offer the young reader esteem for his wisdom and courage This gives life to a mutual-admiration society gathered around the challenger Inspire bold and independent thinking Found movements Teach adherents what they are and how they stand apart 27

Challengers n n n The challenger tends to be self-centered. He tends to have a high estimation of his own importance and destiny. Importance not only in what he has to say, but in his believing it, because of his super acute wisdom or judgment. 28

Bargainers n n Suppose Joe is a classical liberal and in a discourse situation is bargaining, arguing for Belief Y over Belief Z. On higher level issues, Joe might: falsify his beliefs n acknowledge his true beliefs n remain mute or ambiguous n 29

Bargainer Gallery n Friedrich Hayek – Economist and philosopher 30

Bargainer Gallery n Aaron Wildavsky – Amer. political scientist 31

Bargainer Gallery n Richard Epstein – Amer. legal scholar 32

Bargainer Gallery n Tyler Cowen – American economist 33

Bargainer Gallery n Virginia Postrel – American author, journalist, editor 34

Bargainer Gallery n John Tierney – NY Times columnist 35

HAYEK “Use of Knowledge” article: n Disguises the voluntary/coercive distinction: n n n Use “decentralization” and “competition” rather than “freedom” or “liberty”: p. 521, 523, 524 Never says he favors fundamental reform. Claims that the disagreement is a matter of intellectual error, rather than fundamental commitments. Hence, persuasion of mature minds remains possible: n “[T]he differences can indeed no longer be ascribed to political prejudice. The remaining dissent seems clearly to be due to purely intellectual, and more particularly methodological, differences. ” (p. 112) 36

n n n In Co. L, he provides multiple vague definitions of liberty. Never makes clear that ordinary regulations like minimum wage are coercion. Hedges and fudges on fundamental policy issues. Avoids them, or treads gingerly. Eschews the word “libertarian”, using “liberal” instead. Later, following 1960, with waning status, Hayek becomes more challenger-ish. E. g. , “The Atavism of Social Justice”, The Mirage of Social Justice. Starts using the word “libertarian” somewhat. 37

Bargainers n Inspire adherents to be persuasive and effective in meeting and joining and cooperating with power, to stand with others as colleagues in power but as something somewhat different from them. 38

Turn, turn n n If discourse situations were perfectly segmented, it would behoove the classical liberal to argue as best suits his abilities and the situation. Example: I bargain more in teaching than in writing. I argue for vouchers, granting that education should be subsidized for public good/equity reasons. 39

Prominence n n n A key factor of segmentation is prominence. The prominent are more visible in all that they do. They more need to project a single persona. The less prominent can more effectively play it both ways. I think people ”turn” too little, perhaps because they have an inflated notion of their own prominence and need for consistency. We often try to emulate our heroes, but our heroes were more prominent than we. 40

Declining segmentation? n n The Internet etc may be making it harder to do this. Even lectures might find their way onto the Internet. Exposé. But vanity may lead us to over-estimate this constraint. A little inconsistency is no shame. 41

Connection to Esoteric Writing n n We have assumed the bargainer’s criticism of Belief Z basically resembles that of one who sincerely believes Y. The Strauss dimension: Apparent bargaining as esoteric challenging. Here the bargainer’s criticism of Z contains between the lines criticism of X and possibly W. For example, Hayek’s explicit definition of liberty was really mainly a listing of correlates of liberty, while the true definition of liberty was between the lines. 42

Royalty n n Enjoys establishment eminence Two aspects: 1. Eminent among one’s close circle of peers 43

Royalty n 2. That circle is recognized throughout society as eminent 44

n n n Royalty enjoys a sense of ascendancy Royalty acts as though its ideas are or can become official establishment doctrine Royalty evades the distinction between the mature/powerful (speaker B) and the young/disempowered (the listener). Royalty acts like all can be persuaded alike. Royalty downplays any radical implications of what it might be saying. Often conceals or blurs their libertarian position on touchy issues. Resorts to inconsistency, vagueness, platitude, elision. 45

Royalty Gallery n Adam Smith 46

Royalty Gallery n Milton Friedman 47

SMITH n n n Enjoyed establishment eminence and ascendancy Explains that the world around us is a manifestation of his principles. His principles already reign. (Div of labor, spon order, etc. ) Smith assures the reader that he does not follow the simple libertarian principle 100% (p. 289). Smith endorses several contraventions of natural liberty. One interpretation of this is that he actually believed in those contraventions. Another is that he is allaying concerns of his strict adherence to simple radical principles. In TMS, he praises gentle, pragmatic reform and compromise (p. 380) 48

n n Smith plays it both ways on natural liberty and justice: Sometimes the two coincide, but sometimes he favors contraventions nonetheless. In the case of restriction on being a shopkeeper (which he opposes) he says is a violation, hence unjust, and then adds that it was also “impolitic” (both Stewart and Millar use expediency). So he adds another layer within which he can talk “justice” and yet refrain from libertarian positions. Inconsistency? As when he says school costs may be defrayed by tax-dollars “without injustice” (WN 815) Or when he restates the matter of desirable violations in back to back sentences (WN 324) 49

n Honors the powerful: n n “he may assume the greatest and noblest of all characters, that of the reformer and legislator of a great state; and, by the wisdom of his institutions, secure the internal tranquility and happiness of his fellow-citizens for many succeeding generations. ” (TMS, p. 378 -79) Smith writes of party leaders fudging and dissembling. Irony? 50

Friedman n He enjoyed establishment eminence and ideological ascendancy. He explains that the world around us is a manifestation of his principles. His principles already reign. (Div of labor, spon order, etc. ) (pp. 9 -13) Writes of the progress of enlightenment following Adam Smith (p. 33), and the achievement of a golden era (p. 35). But interventionist errors “have since” reappeared. Downplays how pervasive they are today (p. 33). 51

n n Milton and Rose make the voluntary/coercive distinction. However, they blur the definition of “freedom” somewhat (p. 11), and they are vague about how strictly they adhere to the liberty principle. They fudge their way through the discussion of Adam Smith’s three principles of natural liberty. They tell the reader that they do not uphold a rigid adherence to the principle. They honor the process and institutions of power. They affirm that we can all agree to fix the problems: n “Our society is what we make it. We can shape our institutions. Physical and human characteristics limit the alternatives available to us. But none prevents us, if we will, from building a society that relies primarily on voluntary cooperation to organize both economic and other activity, a society that preserves and expands human freedom, that keeps government in its place, keeping it our servant and not letting it become our master. ” (p. 37) 52

Two Issues n n Is royalty possible today? The relationship between Challengers and Bargainers 53

Is Royalty Possible Today? n n I don’t really think so, though we should try. Arguably, Epstein or Gary Becker is the closest case of royalty. Charles Murray has some royalty qualities. If Tyler Cowen got a Harvard econ appointment. . . 54

Is Royalty Possible Today? n n n We are still in the Social Democracy phase of the Hayekian Narrative. Academia is structurally pyramidal and culturally central. There is little prospective of real classical liberal ascendancy there. The centrality of academia may be declining. But the rest of the political culture is increasingly fragmented. Maybe cultural royalty is receding generally, not just for classical liberals. 55

Friedman: An aberration? n n His success is cause for hope However: n n A special moment: 1947 -1990, say, was a period of classical liberal renaissance, and Milton rode the crest of a wave (which he helped to effect, of course). Many things, like textbook Keynesians, were ripe for revolt. The Chicago Econ Dept was a particular and remarkable thing. Friedman is a remarkable individual. Rose Friedman a big part of the story? 56

n Friedman’s attitude toward the economics profession: He affirms the invisible-hand of the ”academic market”, to utilize a position of royalty. n He never criticized the economics profession. n Yet he in fact broke out of the academic mode of thinking and acting. n n I think Smith never faced this kind of tension. 57

Relationship between Challengers and Bargainers n The main point: They don’t really disagree on substantive policy views. They just are playing different roles in the cultural struggle. 58

How Bargainers can help Challengers n Bargainers often show more intellectual flexibility n often have more intimate knowledge of current policies and issues. Hence, bargainers can exert intellectual discipline on the challengers. n often enjoy more mainstream stature, and can help challengers get an audience and respectability. n 59

How Challengers can help Bargainers n Challengers can: serve as the conscience of bargainers, reawakening them to more fundamental beliefs n show broadly the more basic ideas still hold up n re-activate the bargainer’s authenticity and reconnect them to nobler pursuits, such as inspiring and edifying the young n 60

A delicate relationship n n n A bargainer might help a challenger to get a mainstream hearing, but only if she can trust him not to become unduly glossy. The challenger must likewise trust the bargainer not to turn on him. Distrusting, they may shun team efforts altogether. 61

Needful Cooperation n n There are gains in team productivity achieved by the division of labor. Being mindful of the larger common cause may encourage mutual contact and moral support. 62