Errors of Friedrich Hayek

Hayek and the Liberalettes

The Clockwork-Rationalist roots of modern ‘Conservatism’

by Gwydion M. Williams

Society is ‘just individuals’, say the New Right. In the same sense, a piece of writing is just words, Shakespeare is just words. But most writing is not Shakespeare. A piece of writing like ‘wnhrer uyetn rfhgfg’ is meaningless even though each component part is a perfectly valid letter.

A diamond is just carbon atoms. Soot is just carbon atoms. So too are graphite and buckmeisterfullerine. In each of these forms, it is the relationship between the atoms that makes all the difference.

Chlorine is a green poisonous gas. Sodium is a sparkling metal that reacts furiously when you drop it into water. Put these two unfriendly types of atom together and you get sodium chloride, common salt, an essential substance for life as we know it.

New Right ‘individualists’ are the least individually distinct individuals that you can readily meet. Businessmen have always been boringly standard and predictable outside their own particular area of expertise. Women in business are getting almost as dull and predictable now that they have joined the game. And even the New Right theorists are pretty boring people, saying almost exactly the same thing, with none of the range or originality that is found on the Left.

Hayek is probably the best of these characters. But the best is none too good. He looks back to the Liberal Catholic thinker Lord Acton. Acton tried to reconcile Catholicism with Gladstonian Liberalism. But when the Catholic Church moved decisively the other way, issuing the ‘syllabus of errors’ and proclaiming Papal Infallibility, the bold Lord Acton remained weakly silent.

Acton was also the fellow who said ‘Power tends to corrupt and absolute power corrupts absolutely’ – a remark that the Oxford Dictionary of Quotations traces back to Pitt the Elder’s ‘Unlimited power is apt to corrupt the minds of those who possess it’. Pitt’s remark is probably better – power with proper checks and balances is as likely to educate and improve as to corrupt. Most people go the other way, to the easy undemanding cynicism of just saying ‘power corrupts’. Hayek however goes one better – he attributes the misquotation to Acton himself. (Heading for Chapter X, The Road to Serfdom).

In the same work Hayek says

“The extraordinary thing is that the same socialism that was not only early recognised as the gravest threat to freedom, but quite openly began as a reaction against the liberalism of the French Revolution, gained general acceptance under the flag of liberty… The French writers who laid the foundations of modern socialism had no doubt that their ideas could be put into practice only by a strong dictatorial government. To them socialism meant an attempt to ‘terminate the revolution’ by a deliberate reorganisation of society on hierarchical lines… the first of the modern planners, Saint-Simon, even predicted that those who did not obey his proposed planning boards would be ‘treated as cattle’. Only under the influence of the strong democratic currents preceding the revolution of 1848 did socialism begin to ally itself with the forces of freedom.” (Ibid, p 18).

Hayek starts with a grain of truth, and then proceeds to talk nonsense. The French Revolution did represent Hard Liberalism, the belief that an atomised mass of separate individual, freed from all traditions, would automatically create a perfect world. The success of the American Revolution did seem to vindicate this view. People failed to realise that the Americans had built on traditions of responsible politics that the various states had had as self-governing colonies within the British Empire. Given a sound foundation, it was relatively easy to teach this system to fresh waves of immigrants, many of whom had similar traditions anyway.

Things were very different in France. Responsible self-government had been successfully suppressed by Louis XIV. Hard Liberalism fell into chaos and corruption when faced with the problems of governing a real society. People with no political experience blamed each other for the fact that harmony did not spontaneously emerge from democracy. After much confusion, France eventually opted for the Liberal Autocracy of Napoleon.

Saint-Simon, who was one of those Frenchmen who had fought idealistically for liberty in the American War of Independence, changed his ideas after seeing the breakdown in France, having been imprisoned during the Terror. He reached the eminently sensible conclusion that a decent society does not spontaneously emerge from unrestrained individualism. Having seen this, he did rather look to the past, though he also advocate rule by what we would now call ‘technocrats’. He was also, incidentally, the first person to think of building a canal to link the Atlantic and Pacific. But while he contributed to Socialism, he was certainly not the creator of the creed.

The received standard view is that Socialism had four main founders – Saint-Simon, Babeuf, Robert Owen and William Godwin. Babauf was a leader of the ‘Hard Left’ of French Republicanism. His ‘unsuccessful attempt to overthrow the Directory government in 1796 is commonly regarded as the starting point of the modern socialist movement…   Babeuf and his followers regarded socialization of the land and industry as necessary to complete the revolution begun in 1789… by revolution carried through under a revolutionary dictatorship.’ (Encyclopaedia Britannica entry on Socialism, 1966 edition.)

The actual word ‘Socialism’ originated in Britain in the 1820s, in the Owenite Cooperative Movement. This movement was for many decades separate from and indifferent to the struggle for political democracy. It was a rival to the radicalism advocated by English egalitarian idealists like William Godwin. Godwin had supported the moderate French Republicans who were swept aside by the Jacobins, while Owen showed no interest in the matter. His initial work as a philanthropic mill-owner was admired by many in the English ruling class that had triumphed over Napoleonic France. But as soon as Owen made it clear that he put the interests of the poor above the rights of existing property, he ceased to be acceptable to the rulers and was taken up instead by the rising class of propertyless workers.

The question of influences is a complex one. Godwin’s heritage can with some logic be claimed by socialists, by anarchists and by right-wing ‘libertarians’. Godwin had a wildly unrealistic notion that small property-owners would spontaneously share with anyone who needed it, once the simple justice of their claim was pointed out. Subsequent thinkers found different solutions to the unfortunate failure of real small property-owners to be so generous. A more realistic view was taken by Thomas Spence, a contemporary of Godwin, whose followers were perhaps the first organised socialist body in Great Britain. (Ibid.) And the Spenceans were also very prominent in support for Republican France and in the campaign for Parliamentary Reform.

Hayek is quite wrong when he attributes to Socialism in general an hostility to French Republicanism that is only true for one of the four commonly recognised co-founders. Though it can not be denied that a hankering after the certainties of 18th century Enlightened Autocracy was a part of the socialist heritage. Indeed, the Communist Manifesto has a whole section on ‘reactionary socialism’, including ‘feudal socialism’, though St. Simon under ‘critical-utopian socialism and communism’. One could argue about exact categories. But I think that it is no way to the discredit of socialism that it bridges the rift in European society that was implicit in the Enlightenment and made manifest in the French Revolution.

[I should have added that others on the New Right condemn Socialism for being a continuation of the French Revolution – Ayn Rand, for instance.  In fact it was a new creed that remixed ideas from radicalism and conservatism.]

Socialism replaced Liberalism, because Liberalism was unable to solve problems that its doctrines considered to be impossible. Socialism at its best combines the Liberal belief in Freedom with the Tory or Traditionalist notion that everyone has a right to a modest place in any civilized community. Hayek however prefers to takes no notice whatsoever of anything that he can not fit into his own dogmatic little schema. And yet this is one of the best of them, winner of the 1974 Nobel Memorial Prize in Economics.

It should be understood that there are two sorts of Nobel Prize. There are the famous and highly respected prizes for physics, for chemistry, for physiology and medicine, for literature and for peace. These are awarded annually by the Nobel committees to people who are reckoned to have done something really notable in those fields for the benefit of humanity. And then there is the quite separate Nobel Memorial Prize in Economics, created by economists to be given to other economists.

Economists are not the only professional group to resent not being included in Nobel’s original group. But they seem to be the only group to have given their own prize a spurious status through copying the name of a award whose merit has been well earned and generally accepted.

As well as being the winner of an odd sort of Nobel Prize, Hayek advocates an odd sort of Liberalism. A Liberalism that is taken up by people who hate Liberalism in the wider and more serious sense

Liberalism in its origins meant several different things. Its first root was the privileged status of a free person in the late Roman Empire, when the vast majority were in some measure unfree. It later acquired the meaning of large-spirited or generous, a person who showed traditional aristocratic values. Politicians like Burke, the two Foxes and the two Pitts would have regarded the terms ‘liberal’ and ‘conservative’ as equally acceptable and complimentary. And all of them were solidly in the Whig tradition, of course. The wartime coalition that Pitt the younger led and which Burke supported gave rise to the 19th century Tory Party, but it is doubtful if they ever regarded themselves as anything other than Whigs.

It was only in the 19th century that people properly understood that there you had to strike some sort of balance between individual choice and preserving social values that most people regarded as desirable. Classical Liberalism flopped when it became obvious that they had massively overestimated people’s tendency to ‘spontaneous harmony’.

New Right ‘liberals’ are of another sort. I have never yet seen a large-spirited or generous person among them. Some of them claim to be ‘libertarians’, but the only liberty they care about is freedom for people like them to live lives very much like theirs, and only if they have the money to do so. They hang on dogmatically to abstract notions that had a genuinely liberating result when first put forward. But they support right-wing populists who have made ‘Liberalism’ a dirty word.   This is literally true in America, where Reagan’s reference to ‘the L-word’ have made most Democrats anxious to deny their own heritage.

The New Right have successfully shifted the blame for America’s problems away from social divisions and onto the helpless poor. Given this mean small-spirited outlook on life, the right word for them is surely ‘Liberalette’, a diminished version reflecting a faded greatness.

Most people do not change much after the age of twenty-five. A few may go very radical in middle age, while others revert to very old-fashioned or perhaps just eccentric values. But the bulk of society will carry on much as before, regardless of what may change after they were twenty-five. So for a time, it will seem as if even the most profound and disruptive changes have made no difference. Societies have a natural inertia that will last a generation or two. But when this runs out, there is no hope for them.

People thought that Khrushchev had made dramatic social change inevitable, when he managed to denounce Stalin and suppress a popular uprising in Hungry within a single year, 1956. But the system carried on much as before, later dumping Khrushchev as a source of unwanted disruption. Then there was the crushing of the Prague Spring in 1968. People said, things can’t go on like this, with a system that has so thoroughly discredited itself. Yet it did, for another generation or more. But by 1991, those who had been 25 in 1956 would have been reaching sixty. Those who had been 25 in 1968 would have been in their late forties. In its last days, the USSR had no determined defenders, and no one at all chose to die for it.

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