Until recently, I had only read the first two books of Hayek’s grand trilogy Law, Legislation and Liberty. People told me that the third book was the least interesting. The real action, they said, was in the first two books. I decided to see for myself whether they were right. After finishing the book, I admit that much of the analysis is straightforward public choice theory that others had already carried to a higher level of sophistication. Further, the conceptions of law, spontaneous order and the critique of social justice are best articulated in the first two books. However, Book III has a number of interesting elements. One of them is Hayek’s insistence on a universal basic income while vehemently rejecting the idea of social justice. On this blog, we sometimes tie the two together. So what gives?
Let’s consider the relevant passages:
The assurance of a certain minimum income for everyone, or a sort of floor below which nobody need fall even when he is unable to provide for himself, appears not only to be wholly legitimate protection against a risk common to all, but a necessary part of the Great Society in which the individual no longer has specific claims on the members of the particular small group into which he was born (55).*
So Hayek is for a minimum income. This much is clear. But notice the next passage:
It is unfortunate that the endeavor to secure a uniform minimum for all who cannot provide for themselves has become connected with the wholly different aims of securing a ‘just’ distribution of incomes (55).
What? Isn’t the point of the UBI to secure a just distribution of incomes? Isn’t the UBI legitimate because people it is owed to people in order to justify the social order as a whole?
I think Hayek’s critique of social justice does not apply to the evaluation of the rules that govern a society’s basic structure. Instead, Hayek meant to refute the idea that we can make specific claims about whether certain domains of goods and services are justly distributed. An example might be a claim that social justice requires a price floor for coal miner wages. Hayek claims that these practices cannot be evaluated as just or unjust because no one decides that miners should be paid a certain wage. Distributive justice can only apply if we have a decider. As a result, miner wages on the market cannot be the proper subject of evaluation.
But doesn’t Hayek’s argument against social justice therefore apply to evaluations of a society’s basic structure?
The answer seems to be no. Consider the following fascinating passage:
The basic conception of classical liberalism, which alone can make decent and impartial government possible, is that government must regard all people as equal, however unequal they may in fact be, and that in whatever manner the government restrains (or assists) the action of one, so it must, under the same abstract rules, restraint (or assist) the actions of all others. Nobody has special claims on government because he is either rich or poor, beyond the assurance of protection against all violence from anybody and the assurance of a certain flat minimum income if things go wholly wrong. Even to take notice of the factual inequality of individuals and to make this the excuse of any discriminating coercion, is a breach of the basic terms on which free man submits to government (143).
On Hayek’s view, the UBI is required as a condition of democratic legitimacy within the framework of a social contract. I’m not saying Hayek is a social contract theorist, but he sounds like one in this passage. In order for a democratic government to be legitimate it must treat people as equals by imposing only abstract rules on them. Government gives no one special privilege, and this requirement is compatible with providing them with means to secure basic goods and services.
Of course, there are severe limits on redistribution. Consider that
[A]ll use of coercion to assure a certain income to particular groups (beyond a flat minimum for all who cannot earn more in the market) be outlawed as immoral and strictly anti-social (150).
Despite these limits, Hayek supported a UBI as a condition of democratic legitimacy, which dovetails nicely with some of the conceptions of social justice defended here.
* Don’t think that Hayek’s support for the UBI makes him a squishy statist. A page later Hayek rejects the government’s monopoly on money production, putting him significantly to the right even of many libertarians. Towards the end of the book, Hayek even claims that the decay of democratic civilization cannot be stopped unless money is denationalized.