Liz Anderson on Social Democracy and Libertarianism

I just finished listening to Elizabeth Anderson’s Dewey Lecture in Law and Philosophy at the University of Chicago, on “Tom Paine and the Ironies of Social Democracy.” It’s a great lecture, and I highly recommend it to BHL readers (along with her recent interview in 3:AM here). The thesis of her talk is that there’s nothing particularly “socialist” about state-financed and state-administered social insurance programs. Such programs have a long history in the liberal tradition, going back to Condorcet and receiving one of the earliest and fullest articulations from the almost-libertarian Thomas Paine in his essay on “Agrarian Justice.”

There’s a lot of great stuff in this lecture, including a discussion of the ways in which Hayek’s Road to Serfdom has been misread (understandably, perhaps) as arguing that any social welfare scheme will lead inevitably to socialism and the gulag. In reality, Hayek actually defended various aspects of the welfare state in RTS, and criticized the “wooden insistence of some liberals on certain rules of thumb, above all the principle of laissez-faire.” We’ve discussed similar misreadings of RTS here recently.

But what especially caught my attention was Anderon’s discussion, in the Q+A I believe, of the Hayekian thesis that rules and order can emerge spontaneously without the state. Anderson references the terrific work of Robert Ellickson on this issue, and praises it highly. But she makes what I think is a trenchant critique – one that ought to be of great interest to the anarchists among us, given their frequent reliance on Ellickson and similar work (see this great anthology for a sample). Hayekian stories, Anderson says, seem to work well when you have small, stable, face-to-face communities consisting of people who are already basically equals. Groups like this, she says, really can do a pretty good job of working out norms on their own, and we have lots of good reasons to leave them alone rather than try to impose rules on them from the outside.

But not all groups meet these conditions. In particular, some groups are not groups of equals. Some groups have severe and stable relationships of domination and subordination. And Ellickson (and Hayek) just don’t seem to have much to say about them. This is troubling, because it seems like we have good reason to expect that the rules that spontaneously emerge in these kinds of groups will serve to reinforce those unequal relationships in ways that strike us as perhaps unjust. And it is especially odd, as Martha Nussbaum notes in the question period, that Hayek of all people didn’t notice this, given his important work on John Stuart Mill and Harriet Taylor – two individuals whose work is rich in its explorations of the ways in which domination and subordination characterize relations between the sexes.

My guess is that Anderson hasn’t been following the recent work of Charles Johnson and Roderick Long that touches on some of these themes. Which is a shame, because it’s really quite good. And, of course, Anderson doesn’t directly address the crucial comparative question – does the state do a better job at remedying pre-existing inequalities than non-state institutions?

Still, there’s an important kernel of a challenge here – one I’d like to see better developed by the critics themselves, but also one I’d like to see addressed by the anarchists themselves. Can the “just so” stories of the spontaneous emergence of “nice” social rules in small, stable, face-to-face societies of equals tell us much about what’s likely to happen in the larger, more fluid, more impersonal, and more inegalitarian societies of modernity? And if not, where does that leave the case for anarchy?

  • Rather than Hayekian spontaneous order requiring some degree of equality, I think it makes more sense to interpret spontaneous order as a broad term for societal evolution that, over time, helps individuals attain the ends they’re seeking to achieve (equality or otherwise).

  • The more commentary I read on Hayek the more I am convinced that hardly anyone understands The Fatal Conceit. Spontaneous order for Hayek was an evolutionary theory on a macroscale, not a neat little theory about how small societies work together. So on the contrary if you think that Hayek was just thinking about groups of individuals who enoy equal power and not the long messy process of cultural evolution as it actually happened then you missed pretty much the core of Hayek. The point not to be ignored however is that the process by which our morals have come into being may be far different fromwhat our intuitions expect. Indeed the process of cultural evolution is disturbing. I am convinced Hayek was right in suggzsting that his is why intellectuals tend to reject the morals that we have inherited from this process. Whereas he saw that without it we could not have succeeded as a species most intellectuals refuse to put their faith in anything so ill planned.

    • I, too, was stunned by the comment: ‘Hayekian stories, Anderson says, seem to work well when you have small,
      stable, face-to-face communities consisting of people who are already
      basically equals.’ Has she even read Hayek? He opposes the rules of the spontaneous order to the rules of the tribe.

      I haven’t listened to the lecture, but I will give it a go later (whether or not I stay with it till the end, I don’t know).

    • I wouldn’t regard the Fatal Conceit as the definitive text for Hayek’s thoughts on spontaneous order. That would have to be the first volume of Law, Legislation, and Liberty.

      Taking those two volumes together, it seems clear that Hayek has a theory about spontaneous order as something that develops across societies – different societies adopt different rules, and order emerges as the better rules spread and the worse ones die out. But it also seems clear that spontaneous order is supposed to be something that emerges within a society, even at the level of a “tribe.” Certainly, this is how Hayek’s followers talk. Language, manners, footpaths, social practices like “slugging,” etc. have all been put forward as examples of spontaneous orders. Anderson’s point, and I take it that it’s the same point that Charles Johnson makes in his fine essay, is that Hayek and Ellickson don’t give enough thought to the sort of spontaneous orders that emerge when background inequalities are significant. The kinds of spontaneous orders that libertarians point to and say “look how great this is” might be a kind that develop only in a particular kind of circumstance. If we focus on those while ignoring the nasty kinds of spontaneous order, we’re going to be left with a very misleading picture.

      • MARK_D_FRIEDMAN

        Matt,
        I sense a little of the “checken and egg problem” here. Is it not possible that what you refer to as “background inequalities” are themselves the product of (useful) social evolution? For example, in the C of L Hayek argues that the institution of inheritence plays a very valuable social function in concentrating resources in the hands of persons who are then able to support what at the time are radical ideas, movements and practices.

        • MARK_D_FRIEDMAN

          There is a related point. You say: “In particular, some groups are not groups of equals. Some groups have severe and stable relationships of domination and subordination. And Ellickson (and Hayek) just don’t seem to have much to say about them. This is troubling, because it seems like we have good reason to expect that the rules that spontaneously emerge in these kinds of groups will serve to reinforce those unequal relationships in ways that strike us as perhaps unjust.”

          There is, I believe, a danger here of interepreting Hayek in a manner that is fundamentally unfair. The very idea of “spontaneous order” presupposes some minimal level of free action within a given society. Otherwise, instead of spontaneous order, you will have dictatorial control or master/slave relationships. Of course, in such environments, you will not have unguided social evolution, but instead “command and control,” its very opposite. But this fact hardly counts against Hayek, at least as I understand him.

          • Well, that depends on what it takes for an order to count as “spontaneous.” As Charles Johnson notes in the essay I linked to, Hayek uses the term in several different senses. Sometimes it seems to refer to orders created by consensual interactions, while in other cases it seems to refer to orders created by decentralized decision-making. Clearly, an order created in a top-down, coercive process should not count as spontaneous. But it’s less clear what we should say about orders that are generated in a bottom-up way but with significant coercion, or those created in a top-down way but via consent.
            At any rate, many of the inequalities that Anderson is worried about – racial inequalities, sexual inequalities, and even many economic inequalities – involved a mix of coercion and free choice. The system of slavery was a gross injustice, but racial inequalities developed in more decentralized and less straightforwardly coercive ways as well.

          • TracyW

            I don’t think the top-up/bottom-down distinction is fundamental to Hayek’s thinking. To quote from Kinds of Order in Society (see http://oll.libertyfund.org/index.php?option=com_content&task=view&id=1269&Itemid=280)

            THE SIMPLE CONCEPTION of an order of the kind which results when somebody puts the parts of an intended whole in their appropriate places applies in many parts of society.

            But it is not the only nor even the chief kind of order on which the working of society rests; …

            The discovery that there exist in society orders of another kind which have not been designed by men but have resulted from the action of individuals without their intending to create such an order, is the achievement of social theory…

            And Hayek’s argument as to why spontaneous orders are best is that they’re the only way to achieve a anything beyond the most primitive organisation:

            This indirect method of bringing about an order has the advantage that it can be used to produce orders which are far more complex than any order we can produce by putting the individual pieces in their appropriate places.

            Implicit behind that I assume is that complex organisations allow more economic production than simple organisations (see Adam Smith’s arguments about Division of Labour), and that more economic production is a good thing all else being equal as it produces more goods.

        • Sure, I think that’s going to be a plausible account for some inequalities, and I think Anderson would agree. But here’s the problem. Any evolutionary account, including Hayek’s, is going to hold that certain norms emerge from a process if they are “fit” in the right way. But why assume that “fitness” is always going to line up with the social good? Why, that is, should the process of cultural evolution select for rules that serve the common good and not those that serve the interests of the entrenched powers?

          • MARK_D_FRIEDMAN

            You ask, “But why assume that “fitness” is always going to line up with the social good? Why, that is, should the process of cultural evolution select for rules that serve the common good and not those that serve the interests of the entrenched powers?” Well, I think Milton Friedman gives a pretty good answer to this question, at least as it pertains to free market economies, in Chapter 7 of Capitalism and Freedom. As you know, he argued there that (roughly) the economic pressure of operating efficiently in a competitive marketplace would force persons and firms not to discriminate arbitrarily, and that over time economic power would result in political power, and equal rights. Accordingly, the beneficial effects of spontaneous order are maximized under free market capitalism; an additional argument against “command and control” economies.

            So, in your original post you say: “In particular, some groups are not groups of equals. Some groups have severe and stable relationships of domination and subordination. (my emphasis). What groups do you have in mind with respect to communities whose economies are organized roughly along free market lines? Do you have any doubt that the rights and status of women, minorities, gays, etc. have improved dramatically here over the last 50 years?

          • I don’t doubt the claims you make about the improvement of those groups, and I don’t disagree with the general thrust of the Friedman story about competitive markets. I do think that situations of market failure are just as “spontaneous” as instances of market success. So cases in which powerful groups routinely externalize costs onto less powerful ones might be one example of a solution that is evolutionary fit but not morally attractive. I also think that questions about spontaneous orders are broader than economics alone, so “free-market” vs. “non-free-market” might not be the only interesting contrast. Free market societies can harbor social and cultural practices that ignore or reinforce objectionable hierarchies. Again, Anderson’s recent book on race issues is replete with examples.

          • “Free market societies can harbor social and cultural practices that ignore or reinforce objectionable hierarchies.”

            Of course. But what is the remedy? Do we stay within a free market society and try to educate and persuade? Or do we follow the Andersons and prevent people from doing what they most want to do?

          • Can’t the answer be, “it depends?” To my mind, classical liberal principles give us very strong reasons to prefer voluntary/market solutions over coercive/state-based ones. But those principles are not indefeasible. And so I’m hesitant to say that we must choose either the market or the state as the remedy, forever forsaking the other. Of course, that’s Anderson’s position too.

          • I agree, it depends; though, as a ‘wishful anarchist,’ my presumption is that we explore the voluntary approaches first. That is not Anderson’s position.

          • MARK_D_FRIEDMAN

            Since you are a self-described libertarian/classical liberal, I trust that you are aware that the idea of “market failure” is, from this perspective, something of the unicorn of economics. People think they know what it looks like, but actually identifying cases where the market has failed (rather than, for example, the state’s failure to adequately enforce property rights) is much harder than first appears. If by chance you need a reminder, I suggest a conversation with professional economists such as Prof. Horwitz or Prof. Boettke, both on your roster of BHLs. Or, a review of Chapter 2 of Mark Pennington’s excellent book, Robust Political Economy: Classical Liberalism and the Future of Public Policy.

            These gentlemen would also counsel that whether we are referring to economic outcomes or “social and cultural practices that ignore or reinforce objectionable hierarchies” (I confess to fining this locution rather vague), the “cure” of governmental intervention will almost always be worse than the “disease” itself.

          • Thanks for the “reminder,” Mark, but yes, I am aware of the standard classical liberal analysis of market failure. Nothing I said is inconsistent with it. To say that a) a lot of things that people think are market failures are really not, and b) government cures for market failure are often subject to their own problems, is not to demonstrate that c) market failures do not exist.

          • They can, indeed. But the efficiency-incentive definitely puts some pressure on agents to look beyond colour and race to focus on productivity. Marx agreed with that argument, by the way, when he advocated for more capitalism in India as a way to make the caste system more fragile “modern industry, resulting from the railway system, will dissolve the hereditary divisions of labor, upon which rest the Indian castes, those decisive impediments to Indian progress and Indian power,” he said. I agree with you that not every spontaneously emerged order is “good.” But the argument is mainly for competition and absence o barriers to entry that groups in power usually create to be kept in power. Those barriers they impede spontaneous order to move on, even if the order existant ex ante and created inequalities were spontaneous. In that moment, they are spontaneous no longer.

          • A spontaneous order is one that is an unintended consequence of intentional actions. The people who perform those intentional actions may or may not be involved in hierarchical relationships; in practice, they are almost bound to be, since hierarchies, of one kind or another, permeate human affairs and always will do.

            One of Hayek’s thoughts is that, where rival spontaneous orders spring up, the one that is better-adapted will tend to supplant its rivals. This is because the people in the former will thrive and multiply, more so than the people in worse-adapted orders, and also because people in the less successful groupings will tend to imitate the practices of those in the more successful group or leave their own group to join a more successful one. ‘Better-adapted’ is thereby linked to human flourishing, insofar as that is linked to prosperity and population increase.

            Hayek also recognises that we can improve evolved orders by piecemeal tinkering (e.g., L,L&L, bottom of p.45), though he also warns us to beware of possible unintended consequences of such tinkering. So he acknowledges your point that ‘fitness’ need not line up with the social good. He was a reformer, after all.

          • You say that better adapted orders will supplant their rivals, and that “better adapted” is thus “inked to human flourishing, insofar as that is linked to prosperity and population increase.”

            But one doesn’t have to be a big-government liberal to worry about a story like this, right? Increased (aggregate?) prosperity and population increase is compatible with gross injustice, on (I presume) your standard of justice or Anderson’s. So if “better adapted” = “leads to increased prosperity and population increase,” then the worry still remains about the gap between spontaneous order and justice.

          • I conceded that point in my last paragraph.

          • Well then I think we are in a state of happy agreement!

          • We often are. But we are also often in a state of happy disagreement.

      • TracyW

        What sort of work has Anderson done on the sort of spontaneous orders that emerge when background inequalities are significant?

        • You might take a look at her most recent book on race issues: The Imperative of Integration.

          • TracyW

            Thanks. As it seems to be only about the USA, I’m not interested enough to order it, but will keep an eye out at the library.

    • j_m_h

      Agreed the claim that Hayek must have been thinking only on small scale terms seem questionable. “The Use of Knowledge in Society” was hardly assuming, or requires, a small group of people who know one another. It’s specifically about a spontaneous order that seems to resolve certain problems that exist due to such a lack of personal knowledge.

  • j_m_h

    While there will always be some power differentials and, so, some type of class stratification within societies and therefore social rules/institutions I think there are two points that need to be added.

    1) What’s the assumption about exit? With that an option then I think there’s a limit on how far the “bad” spontaneous order can be.

    2) I forget where by Hayek also talked about the ossification of these emerging rules of spontaneous orders. I suspect these institutionalize social differentials will tend to fall into that class of social rule rather than those of the spontaneous order — which should be dynamic and fluid not providing special treatment for some subpopulation over long periods of time.

  • Blainethebassist

    Interesting article. I completely agree. One question I’ve always had for Anarchists is how would IP law work? Is it a monopoly to have it or should people have property rights over the ideas which they have put labor into creating. Have you ever read much by Rand?

    http://define-liberty.com/2012/07/30/the-prophets-of-capitalism/

  • TracyW

    Hayekian stories, Anderson says, seem to work well when you have small, stable, face-to-face communities consisting of people who are already basically equals.

    This doesn’t strike me as a good description of England from medieval times onwards (and I don’t think we have that good data about social structures in the dark ages). And I thought it was the developments in places like England that Hayek was trying to explain.

    This is troubling, because it seems like we have good reason to expect that the rules that spontaneously emerge in these kinds of groups will serve to reinforce those unequal relationships in ways that strike us as perhaps unjust.

    Yes, but doesn’t Hayek’s work also imply that what strikes an outsider as unjust, or just weird, might well be very well suited, and just, to people with more detailed local knowledge?
    I mean, this sounds a bit like the story about the Persian emperor who brought together groups from far flung countries and asked them how they buried their dead, and each group was horrified by the other group’s practices and thought their practices were the best. Being shocked by the foreign is a very common human reaction, and I’d really be surprised if Hayek or Anderson was the first to comment on it.

    And wouldn’t the mores in small, stable, face-to-face groups (or modern day English society) be likely to strike people who grew up in groups with severe and stable relationships of domination and subordination as unjust as well?

  • Lower Ed

    In claiming that Bismarck was not a socialist, Anderson is wrong.
    The historian William Harbutt Dawson, educated at Berlin University during Bismarck’s lifetime no less, wrote a book called…. Bismarck and State Socialism. Can you guess what Bismarck’s platform, that included social security, was commonly called?
    It is true, as Anderson says, that Bismarck, like Paine, was reacting to a more radical socialist alternative. Bismarck, far from going in an opposite direction, and being the master politician that he was, made use of socialist themes. Bismarck was wholly anti-laissez-faire and strongly believed that the individual must be subordinated to the common good. It was the state’s responsibility to ensure this common good. Bismarck was influenced (or did they rubber stamp his political compromises and maneuverings?) by the prominent academics Adolph Wagner and Gustav Schmoller especially. These outlooks were varying, yet generally labeled State Socialist.
    John Dewey, Anderson’s lecture namesake, was also highly impressed by these forms of anti-liberalism developed in Germany. So were other Progressives more associated with corporatism; fascism too. The common thread was an anti-market, anti-individual subordination to the collective. Bismarck’s collective mechanism was the state. Anderson’s thought borrows some bits of each ism in her support of Obama’s health dictatorship. What else can you be but socialist when you reject laissez faire and individualism?

    • good_in_theory

      “What else can you be but socialist when you reject laissez faire and individualism?”

      Well, you’ve already offered a number of possibilities.

      A progressive
      A statist.
      A communitarian.
      A corporatist
      A fascist
      A civic republican.
      A Christian democrat.
      A centrist.
      A conservative
      A left liberal
      A populist

      Is state capitalism, capitalism (or capitalist)?

      Is state socialism, socialism (or socialist)?

      A son in the sea is not a season and a pet in a car is not a carpet.

      • Lower Ed

        They all have socialistic elements. It is a matter of degree more than kind.

        • good_in_theory

          Oh ok, everything is socialist except the appropriately construed variety of libertarianism. Very insightful.

          • Lower Ed

            What word would you use to describe forced abolishment of market exchange and the associated displacement of private ownership in the means of production, then? This situation may be achieved through regulation and “democracy” just as much as through outright Bolshevik confiscation. So what kind of anti-market oppression do you support? You could use Trollcialism as cover and not be completely untruthful.

          • good_in_theory

            In what world is ‘market exchange’ forcibly abolished and ‘private ownership in the means of production displaced’ by taxing people and publicly providing some degree of health, retirement, and accident insurance/income?

            It is neither the case that ‘taxation’ = ‘seizure of the means of production’ nor that “public provision” = ‘forced abolition of market exchange’.

          • Lower Ed

            “It is neither the case that ‘taxation’ = ‘seizure of the means of production’ nor that “public provision” = ‘forced abolition of market exchange’.”
            Have I little choice but to categorize you as a cultist caught in the web of the state’s illusions?

          • good_in_theory

            I think it’s pretty clear who the cultist here is.

  • famadeo

    I’m inclined to answer this last question in the negative. It’s presicely because of this question that I consider myself *almost* an anarchist but not quite (though not of the libertarian or capitalist variety).

    Either way, since I’m not in touch with the lecture in question, I’d like to know precisely what kind of form these small scale communities take. What exactly is understood in this scenario by “egalitarian”? I don’t see how you can really have such an enviornment without a consistent ethic of horizontality.

  • Graham Peterson

    The idea that small groups are better at collective action than large groups is a widespread theme in social science — it wasn’t Hayek’s idea. Mr Graber and Frederick are correct. Mancur Olson sums up the argument about small groups achieving coordination more easily in The Logic Of Collective Action — but his argument is not complete. I won’t bore with the theoretical and mathematical details, but it’s not clear that large groups inevitably struggle to produce public goods more often than small ones. I appreciate Mr. Zwolinski’s piece, and the insight on Road to Serfdom, but he is conflating intuitions from other scholars with Hayek’s work on the small-group-coordination issue.

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  • DesmondRavenstone

    Anderson’s observations dovetail with those of psychologists, particularly the explanations behind Dunbar’s number — a suggested cognitive limit to the number of people with whom one can maintain stable social relationships (commonly given at 150). Dunbar’s number is seen at work among the Hutterites (who birth new communities after one reaches a certain size), as well as some intentional communities and businesses (e.g. Gore-Tex). It could be argued that this is the reason larger social networks and institutions need more rules and hierarchical structure.