More Question Answering!

I'm not sure why, but I really enjoy writing responses to these "questions to libertarians" articles going around the internet.  It could be because anything original I write is pretty obtuse.  So, time for some funsies courtesy of the Examiner's "The Welfare Question Libertarians Don't Want You To Ask."  Since this actually pertains to my area of research, I'm going to really like this one.

Here's our first money question: If the free market is so great at providing for poor people, why are there so many poor people in the most unregulated and least taxed free market in the First World?

I'm sure you probably think that's just an ideological canard when libertarians say that we don't actually have anything close to a free market.  There's a sincere problem in libertarian circles of defending the existing market forces based on the idea of how a free market would actually function.  There are libertarians that are kind of okay with the status quo of the market.  I'm not.  Lots of us aren't.  And we are starting to do a better job of describing why a freed market is different and is much better for the poor than the present state of big business and big government dominance.

Anyway, the US is #10 or #19 depending on which rankings you use in economic freedom worldwide.  Still near the top, but not the most unregulated in the world.  But getting to your actual point, the constrained version of a market system that we have has benefited poor people immensely.  There's still massive inequality and that may be something to truly lament.  But the material circumstances of poverty in this country are far better than they were twenty, fifty, or a hundred years ago and a distant cry from a live of poverty in a less economically free country.  You can point to the importance of government programs in that progress, and while I would debate their merits, what ultimately made refrigerators, air conditioners, TV, and phones available to the poor was the market economy.

I think the next question you had pertains to "if helping the poor means letting rich people keep their money so they can engage in charity and philanthropy, then why with our present state of the mega-rich aren't the poor doing well?"  The correlate of this argument is that if we taxed people more and got more money into the system, it would be better off for poor people.  I find that kind of thinking does not stand up to a modicum of critical scrutiny.  Of all the funds the government redistributes, less than 10% goes to people experiencing poverty.  The majority is redistributed to the rich and well-connected, who form interest groups that capture the political process.  That's why even though nominal tax rates are quite high for the rich, they can lobby for deductions and hire enough accountants to keep as much money as possible.  Tax revenue does not equal more services for the poor!

Why not?  Well people experiencing poverty are a heterogenous group that face multiple, severe barriers to meaningfully engaging in the political process to capture redistributed funds.  Naked transfer payments are unpopular, so they are forced into a mish-mash of overlapping programs designed to assist the "deserving poor."  They could be forced to leave their kids and work.  Or may lose health coverage if they move to a different state.  Payments in TANF are less than half of the poverty line in each state.  How exactly can you make sure that people in need will win in the political process of getting money?

The fact is these programs are terrible.  They are doing some good, but they do that very inconsistently.  If you care about the poor and care about social justice, you should be looking at structural reform.  What does that reform actually look like?  Well, it looks like a market.  If you want to give money to the poor, give money to them.  Give them a minimum income like Hayek or Friedman or the Bleeding Heart Libertarians have been advocating over decades.  When you put government in charge of determining what people need, you create a game for the interests that stand to profit by getting government privileges for their company or business.  You create static systems, inured to change and unresponsive to individual needs.  You create incentives for government to transfer costs to those in poverty while at the same time ratcheting up spending by each bureau.  Ultimately, by trusting a system rather than a person, you take away their dignity, self-determination, and hope.

The fact is, contra your post, libertarian economics and caring for the poor are a natural and necessary fit.  Social welfare dollars are scarce.  Knowing where that money is best used should be left to those in poverty and the people designing and implementing services to help them.  This is the basis of libertarian economics, and it's downright humanist.  The incentives in a centrally planned system are awful, and as long as you are doing the baseline redistribution social justice requires, you should use the superior (though not close to perfect) market system.

You can argue that churches, charities, and mutual aid societies are too selfish or profit-driven to provide a real support system.  There are some good historical and philosophical reasons to doubt that assertion, but I'm actually quite sensitive to it.  There's something inherently unstable in saying that "in the long run, this leads to the best outcome for all" instead of "we are doing something directly to help you that we think will work."  That's why I like the basic income.

Jon Tomasi's notion of "minimal distributive adequacy" is instructive here.  Can I argue that a free market would provide enough to the poor that they would be better off in real material terms than an egalitarian system of low economic growth and heavy regulation of commerce?  Sure.  But assuming that would be unconvincing, let's instead try and think about ways of actually getting money to the poor so they can use it in a way that makes sense in their lives.  And let's revolutionize the systems they interact with to provide them with the choice and competition that leads to more robust and responsive help.

Alright, Salon, I'll answer your questions

I doubt there is a publication that intentionally misrepresents libertarianism more than Salon.  Then again, this isn't a new cultural notion.  Pretty much every social work and public administration text I pick up reduces libertarianism to self-interest and solipsism ("to think, people believe in that!").  Anyway, inasmuch as this viewpoint is common to those on the left, it's important to genuinely engage some of these concerns.  Moreover, it is important to provide a more nuanced view of libertarianism because often times its proponents do the most damage to its reputation.

In that spirit, I will answer your 11 questions, Salon.

Just to start with a quibble, Rand is popular in libertarian circles (some or most of us started with her).  But, she hated libertarianism and thought we were all libertines and hippies (I'm both!).  She wrote essays on it.  To say her odious philosophy forms the basis of our political philosophy makes no sense and does a great disservice to actual important political philosophers from this school that are influential today.  I'd look more towards James Buchanan of the public choice school and the political philosophy of David Schmidtz and Gerry Gaus.

Anyway, onto the questions.

Are unions, political parties, elections, and social movements like Occupy examples of “spontaneous order”—and if not, why not?

Good question!  Spontaneous order is a foundational concept of libertarian and classical liberal social theory.  Your definition, though it is drawn from Cato, is more a definition of purposive human action, not spontaneous order-- which can be better defined as an order based the product of human action, but not human design.  I prefer Charles Johnson's (2013) definition of spontaneous orders as "characterizing social structures as either: 1) Consensual rather than coercive; 2) Polycentric rather than directive; or 3) Emergent rather than consciously designed."  He applies this example to rape culture and patriarchy, which are the product of many men's uncoordinated oppressive attitudes and violent actions towards women.  

Elections are a poor example of spontaneous order because they are consciously designed and directive, though they are consensual as no one forces me to vote.  Political parties, too, are consciously designed, directive, and coercive.  Unions may be either spontaneous or not, in my view (though certainly some libertarians would differ on this point).  To the extent that unionism is an organic, emergent process that arises from the ground-up and does not coerce people into membership--then they are certainly spontaneous (and indeed beneficial).  Certainly, the early labor movement was a great example of this, and many early libertarians were quite vocally pro-labor.  But, when labor unions become larger, they form an organized interest group that can hurt workers (broadly defined) more than they help.  They are not spontaneous orders, but instead, are another cog in the central planning machine.  Finally, social movements like Occupy are mixed examples of spontaneous order, as they are consensual and polycentric, but are consciously designed.  This is not a detriment, as almost all social movements require conscious design and action.  It is probably your best example.  

Is a libertarian willing to admit that production is the result of many forces, each of which should be recognized and rewarded?

Well, sure.  There is not one definition of production in libertarian economic or political thought.  However, you can think of libertarian economics as looking largely at the forces of production; whereas, modern neo-classical economics looks at the forces of consumption.  I would suggest reading Leonard Reed's classic work I, Pencil for a wonderful thought experiment on how the market rewards each force in the production cycle.  Here's a video, if you like.  

Is our libertarian willing to acknowledge that workers who bargain for their services, individually and collectively, are also employing market forces?

Hell yes!  I don't really get your wording here, but the lead up to the question makes it pretty clear what you're asking.  Labor negotiations are an important part of a market economy.  I'm a left-libertarian, so you're going to get a biased answer here, but my libertarianism sees nothing wrong with collective bargaining.  Employers are free to fire everyone, hire unskilled workers, and train them to replace the unionized workers.  Employees are free to organize, flex their collective muscle, and get better pay and benefits.  

What you're hitting on here is valid, though, and my above discussion elides that fact.  Many if not most libertarians do not like unions.  It is frustrating to me too that libertarianism is often an apologia for the status quo of market relations and takes a generally pro-business slant.  It is difficult for me to support large unions because they are coercive, in that they often demand membership for employment, and form a very large interest group that dominates legislation and political action--similar to big business.  I'm not against this interest group in particular, but all of them, their entire ilk.  

Is our libertarian willing to admit that a “free market” needs regulation?

I would like to offer a semantic play on the word regulation here, but that wouldn't really help things much.  Libertarians generally believe that the regulation of the market is best left to informal and emergent rules than formal rules.  These include the consequences of profit and loss for businesses--which in the present day are generally private profits and socialized losses, but I digress--as well as public opinion, arbitration, tort and contract law, among others.  

Your examples point towards the folly of deregulation, and your examples are somewhat correct.  However, the problem for libertarians is the system of formal, government regulation itself.  When the deregulation is written by businesses to enhance their interests, carving out privileges at the expense of entrepreneurs and consumers, that's certainly worthy of opprobrium.  Libertarians take this a step further and argue in kind that regulations written by businesses to enhance their interests and carve out state-granted privilege at the expense of others is also wrong.  We are generally the ones shouting that Mattel has written the new child safety standards for toys in order to exclude competition from small business.  Or that the financial sector wrote Dodd-Frank.  Or that big pharma and the insruance industry wrote the PPACA.  The game of government regulation makes the benefits so high for interest groups that they pour money into lobbying for rules that will benefit them financially.  It works, and despite the altruistic nature of a few politicians, will always work.  

Does our libertarian believe in democracy? If yes, explain what’s wrong with governments that regulate.

I am so glad you asked!  Democracy is a bit of a sacred cow, and libertarianism (aside from brands of socialism) is really the only school of thought to vivisect and look inside.  Alongside the majority rule problems you learned about in your civics class in high school, a vote is frankly worth almost nothing.  The odds of your vote mattering are less than being hit by a lightning bolt during a shark attack.  Voters are largely ignorant of most political issues and display systemic biases that politicians exploit.  Your choices are between two parties that come with a slate of proposals (that very often overlap) which you must accept as a package.  Your representatives are not saints, but real flesh and blood people, who have their own interests to take care of, like having enough money to get reelected.  Which leads us to the conclusion that the voters don't really matter in the end, it is the small, well-organized interests that win out in the political process.  Democracy, in our view, is best understood as a bludgeon against tyranny, as voting is an unwieldy, blunt instrument that in rare but important cases can check the power of the government.  

Does our libertarian use wealth that wouldn't exist without government in order to preach against the role of government?

Absolutely.  I live off the government currently.  Thanks, Virginians!  

Seriously, though, we live in the world we live in.  Many libertarians do not believe in copyrights or ascribe to a very minimalist version of copyright (as in your Peter Thiel example).  Yes, the internet came from government research.  There are lots of great things that come from government research.  I don't think you demonstrated that these things wouldn't exist without government.  Nor could you!  It's a counterfactual that can't be proven.  But I think there is good reason to believe that these inventions were the result of human ingenuity, not government.  I don't see how the government-ness of the funding and structure makes these inventions better or more likely.  And I am deeply skeptical of how government funding of research implicates and biases scientific research--as I saw in my previous field of research, substance abuse.  Not that what comes out isn't useful to some degree.  Just that we should think about the government funding structure more.

Does our libertarian reject any and all government protection for his intellectual property?

Well, I doubt Peter Thiel would.  It's not in his interest to do so.  Since I haven't done anything useful, and I will never see a red cent out of this blog, I'm perfectly comfortable rejecting government protection for my intellectual property.  And since I'm dirt poor, I'm pretty comfortable with its rejecting government protection of others' intellectual property, too.  I would love to see the Mickey Mouse Curve die off.  

Does our libertarian recognize that democracy is a form of marketplace?

Democracy, loosely defined in your context as government, is indeed a marketplace.  It is a marketplace rigged in favor of entrenched interests at the expense of us all.  That is what libertarian political economy talks about.  Government is not, as you say, a spontaneous order.  It is, in fact, the diametric opposite of spontaneous order.  It is coercive, directive, and consciously designed.  

Another definition of democracy, the free exchange of ideas, certainly fits what you're talking about more.  That is not to be confused with our present government, however.  

Why isn't it important to avoid the creation of monopolies, duopolies and syndicates that interfere with the free market’s ability to function?

I would argue it is more important to understand how a market should combat the creation of monopolies and protected business interests, rather than trying to work out a system that avoids them altogether.  It is in the interests of business to increase profits, so the tendency towards monopoly and syndicate are natural.  Just as natural, however, are the incentives for a member of that syndicate to undercut the monopoly price to gain more market share.  These natural forces make monopolistic arrangements somewhat untenable and unstable, save for one force--government intervention.  I doubt the American Medical Association would, in a free market for medical services, continue to be the monopoly provider of educational and licensing services.  But government privilege makes it illegal to offer competing services, and we suffer higher prices, less competition, and doctor shortages for it.  Less direct measures that subsidize private monopolistic interest often and make up a significant portion of libertarian political theory.  

Does our libertarian recognize that large corporations are a threat to our freedoms?

This is a tough question and cuts to the heart of your earlier point about libertarianism apologizing for the status quo.  For me, libertarians do not do a good job of criticizing how large corporations work in the private sphere of dominating a coercing people, especially workers.  They do a great job of highlighting where big business and big government intersect, but when you take government out of the picture, many if not most libertarians find nothing to criticize.  If, like me, you find this to be unsatisfactory, you should look at some of the works of the left-libertarians.

I would offer, however, that libertarianism, free market economics, and classical liberalism all arose as a reaction and criticism of the mercantilism present in most Western countries.  It was a political order that protected entrenched, monied interests at the expense of small businesses, workers, and individuals.  To this degree, libertarianism does recognize that large corporations are a threat to freedom.  We wish to lessen their influence in government.  

Does he think that Rand was off the mark on this one, or does he agree that historical figures like King and Gandhi were “parasites”?

No, and it's a horrible thought.  There is a strand of conservative anti-poverty, anti-charity in the liberty movement, and that is awful to me and other libertarians.  As you look at other historical figures, there are many who are part of the classical liberal school.  Libertarianism is also influential in the founding of many civil rights and civil liberties organizations.  Rand's ideas are best associated with Objectivism, rather than libertarianism.  It is an understandable straw-man argument, given her popularity.  But, if you wish to understand a political philosophy, I would advise you to dig much much deeper.  

If you believe in the free market, why weren't you willing to accept as final the judgment against libertarianism rendered decades ago in the free and unfettered marketplace of ideas?

Because I wasn't alive?  This question is idiotic, frankly.  You can't on one point say that libertarian ideas are ascendant and then say that they were finally declared dead decades ago.  Libertarianism and its ideas have enjoyed limited victories over the past few decades.  These include deregulation of airlines and trucking, drug liberalization, increased private property rights in the courts, and academic movements of public choice theory and political philosophy.  

There's a lot to be proud of in there.  I hope you'll take a chance to look at it sometime.  I'd be happy to guide you along or find you someone who can help better.  I'm still learning, myself.  

Cato's Work vs. Welfare Study makes me very angry

I've been seeing the press for Cato's Work vs. Welfare study the past few days, and with a little time on my hands today, I've gotten to take a quick look at it.  I really, really wanted to like this study.  Cato does great advocacy and policy work, and I've relied on their analyses of TANF, SSI, and other social welfare programs in the past.  I didn't expect it to be perfect, as many libertarians don't share my bleeding heart concerns.  But the degree to which this is wrong is inexcusable.

I'm speaking from tacit knowledge and personal experience as a social worker in DC.  The figures for some of the benefit levels in this study are just outrageously wrong.  More importantly, it paints a picture that each welfare recipient receives the maximum benefit level of each program.  The authors do note that not every person receives the maximum benefit level nor do they participate in each program.  I would hope that would lead them to investigate further and ask, well, how many programs do people in poverty generally participate in?  And what are the median benefit levels they receive from these programs?  And then generalize an average, prototypical family from those.  

Nope, that's not really a concern for them.  That their figures do not represent what is normal or likely or, hell, even scarcely possible doesn't seem to be important.  There is an annoying and just plain idiotic reliance on the assumption of perfect knowledge of welfare programs, the means and ability to renew benefits perfectly, receive the maximum benefit from the government, and for all benefits to work perfectly and seamlessly.  This picture bears absolutely no resemblance to the life of my former clients.  I doubt it exists for anyone.  

No, Cato, most poor people do not receive TANF.  TANF is a time-limited program that provides less than what is needed to feed a family.  Your figures square with my experience, $428/ month for a family of a mother and two children, but can a family survive on that?  Well, they have food stamps!  I have never seen a family receive $528 dollars in food stamps, as your chart implies.  Maybe that's the maximum allowed by law, but it is far more likely that the welfare consumer you're describing in DC receives hundreds of dollars less than that.  

Aha!  But housing assistance!  The waiting list for Section 8 in DC is over a decade long.  Anyone, including DCHA will tell you that when you sign up.  We could talk about how housing vouchers drive up the price of low-income housing so damn high no one can afford unsubsidized rent anymore and a one-bedroom in Anacostia costs $1000/month.  We could talk about how it is cruel to have people move from place to place, with no address for years on end, because if they DO find housing between when they signed up a decade ago and their name finally gets called on the list, they are ineligible for emergency housing as they are no longer homeless.  We could talk about the perverse incentives of getting a mental health diagnosis to get onto different voucher systems.  We could talk about any one of these things that are damn fucking valid arguments against the status quo of the welfare state.  But apparently, the family you have chosen to examine and generalize all your findings from doesn't have any of these problems.  They have gained the maximum benefit allowed and live comfortably in a government-financed home.  

(I'm not even going to touch Medicaid benefits here.  [twitch])

Well fuck you.  Seriously.  I can't even begin to describe how much damage it does to libertarianism that we assume to know what it's like for poor people without asking them a goddamn thing.  We assume to know what the tradeoff between work and welfare is only by calculating the most efficient economic solution (i.e. maximum welfare payoff vs. maximum low-wage employment payoff).  Moreover, a big-old double fuck you because YOUR CONCLUSIONS ARE RIGHT!  That's right, the tradeoff between welfare and work is still tilted towards welfare!  Your analysis is dogshit, but unemployment is unbelievably high in the poor parts of DC.  It's fucking hard to get a job there.  Social welfare programs may be degrading, bureaucratic nightmares, but at least you get a check for as long as you can.  

Next time you want to study the tradeoff between welfare and work, why don't you step outside the numbers and ask people who use these programs what their experiences have been?  Maybe this way you can actually come to know who it is you are trying to help.  

Quote of the Day

I'm not really working on anything for the blog today, thought I will have a post on public choice theory, crony capitalism, and social work soon.  I just wanted to write this quote down for future use.  It comes from Walter Williams' The State Against Blacks.

While much of the book is on-target, it's points have been made more completely in other sources I have read, the conclusion offers a wonderful synthesis of how classical liberal economics and thought impacts concern for racial discrimination.

"The reason why blacks are disadvantaged because of government intervention is no mystery.  There is a kind of parity in the marketplace that does not exist in the political arena.  Discriminated-against-people generally do beter under a system where there is market allocation of goods and services than where there is political allocation of goods and services.  The market resembles one-man-one-vote.  This means that one person's dollar is the same as another person's one dollar.  The difference between people lies in the number of dollars they have.  No such parity exists in the political arena.

When choices are made int he market arena, people, including poor people, have a higher probability of getting some of what they want, even if they are a minority.  When choices are made through the political arena, they very well may get none of what they want.  That is, if the majority votes to use social resources to produce X and the minority voted for Y, if majority rule carries the day, there will be no Y."

Methodological Individualism: What type of individual?

At my IHS seminars last summer, there was a lot of perhaps deservedly condescending talk of the importance of methodological individualism.  I distinctly remember asking the question of the presenters "What would happen if methodological individualism were followed in the social sciences?"  Dan D'amico pantomimed that it would blow up the social sciences.  I was transfixed.  Here it was, this revolutionary concept that is at the heart of most (but not all!!) of classical liberal social science that was unjustly neglected by the academy.  Or, rather, it was relegated to prosaic discussions of Popper's later works and modern rational choice (constantly referred to as "rat choice").  But I wanted to know more!!!

After having finished my first year, I brought some of my Mises-inspired problems with methodological apriorism and methodological individualism to our resident philosopher of science and asked her to square the two.  She pointed me towards an amazingly important idea.  Methodological individualism exists in both objective and subjective epistemologies and ontologies.  One can claim both objective knowledge on the behavior of a person or say it depends when looking at individuals.  Now that I write this out, it doesn't seem nearly as revolutionary as it was in my mind.

Originally, I had difficulty placing Mises' methodological apriorism, in which what is true is axiomatically derived using logic outside of the subjectivist frame.  But it must be that axiomatic knowledge exists in the subjective realm!  Well, not knowledge that applies to all.  Individuals may use their reasoning skills to create their own (axiomatic, if you like) truths, but those are not true for everyone.  It seems only natural now to put him in the radical structuralist paradigm, along with that other mad freethinker Marx.

Back to methodological individualism.  What I find so wonderful in understanding this is that it helps me make sense of Hayek much better.  Hayek, though not a thorough subjectivist, I would argue DID make the subjectivist/interpretivist turn.  He brought classical liberals into alternative paradigms.  The influence of Polanyi is really felt now.  Mises' individual is a prototypical person who does not turly exist.  He is an abstraction.  He encompasses many.  But we can make generalizations about his behavior, much as we can the individual in postivist or functionalist research.

Hayek's individual, and I would assume Elinor Ostom and Vernon Smith's individual, is the epistemological and ontological opposite.  She only makes sense once her context is known.  That context can only truly be known by the acting individual, and even then, imperfectly known as part of a evolutionary process.  In this frame, history matters, culture matters, and institutions structure action!

So, when I think of methodological individualism, I now know why Hayek's approach rings true with what I know.  Value is subjective.  The social world is already interpreted.  And local knowledge is incredibly valuable.

Then again, perhaps this is out of my sincere desire to never have to read Mises' voluminous tome Human Action...

My Third Rail

As I've gone through the first year of my doctoral program in Social Work, it's been a weird journey to see where I'm taken by the currents of my coursework, independent scholarship, and political reading.  I came into this program wanting to understand how a social worker (or anyone really) could actually be a Bleeding Heart Libertarian in practice.  There are lots of philosophers who provide the headspace for us to play in.  But I didn't know how to live in that place, to make sense of the work I would do as a social scientist and social work practitioner from within that philosophical orientation.  After two semesters of accordion churning, zooming in and zooming out, I feel as though I'm finally on a trajectory that leads me to knowing my philosophical basis and turning that into good practice and research.

The battles I have fought so rested in a few more comfortable areas.  I looked at Austrian economics and left-libertarianism in light of the Burrell & Morgan paradigms and explored how each answered questions about the nature of reality and knowledge.  I looked at applications of public choice theory in social work delivery systems and in social welfare programs.  This was all relatively familiar ground, though it was thin ice as I don't know as much as I appear to.

Last week, I had the wonderful opportunity to present on some advocacy work I did against the living wage to the faculty and fellow students at my school.  It was an enlivening experience, and I received a great amount of validation from my colleagues.  But I hit upon a problem that I don't yet know how to deal with.  I found that I pussyfooted around supply-side and market-friendly solutions to social problems.  In my poster, I had many centrally planned solutions like a Negative Income Tax (or UBI), occupational licensing reform, and school choice/education reform.  However, I didn't touch on the engine of capitalism itself!  It's all well and good to criticize the objectivist fallacies of central planning and government solutions, but it's for nothing without championing the subjectivist, ecological (in the Vernon Smith-ian sense) market.  The market is the subjectivist means by which institutions such as justice emerge.  The market is the signifier for the process of subjectivist social change.  Even Marxism holds that the economic structure is the driving force of all of society, even shaping our very consciousness.  Yet, I neglected to champion its justice-producing effects.  Why?

Well, I guess my answer that seeing the justice in the supply side of economics is a difficult thing for me to make my own, since these are fairly hoary conservative tropes.  It's difficult to differentiate the conservative position from the BHL position.  There is some work there on the left-libertarian side, but it's difficult for me to reach.  These arguments are also far less palatable in academia, I imagine, so maybe I shy away from them for that reason.

In closing, I found myself referencing a Facebook conversation between Emily and myself.  She posted about how the Doritos Locos taco at Taco Bell had reportedly created 3,000 more jobs at the chain.  And she joked that she felt good for contributing to something good.  I sarcastically commented back that embracing the justice of the supply side of economics is a slippery slope.  Both comments were meant in jest, but I think the concept is fairly true.  Looking at the engine of capitalism as a force for equality and good is really my third rail, and one that I need to come to terms with as I continue to develop my ideas.

We lost social change to the positivists

Via Coordination Problem, I came across the (ungated) version of an article by Ulrich Witt on "...Hayek's Epistemic Market Liberalism" in a forthcoming issue of Economics & Philosophy.  Witt highlights Hayek's valuable contribution to economics in his explication of the importance of distributed knowledge in the churning of the market process.  However, Witt does not agree entirely with Hayek's epistemic approach--which he associates, along with the public choice school, an understandable but serious mistake in their epistemological positioning by assuming they abide by the neo-classical paradigm of idealized competition.  That aside, the thrust of Witt's work is to chide, perhaps rightly to a reasonable economist, that Hayek neglects technological knowledge and the insights of Coase and Schumpeter on the "self-perpetuating" market forces that in Witt's view cause negative externalities--the common market failure tropes, most commonly, those in the environment.  He attributes Hayek's disdain for social justice as a concept to an ideological blindness that only sees the market as a benevolent self-correcting system and not the excessive and oppressive beast.

There is little to be said for an author who, in grounding his argument in epistemology, does nothing to address Hayek's numerous works on philosophy of science--a superior philosophical order from which epistemology derives its positioning.  As the Bleeding Heart Libertarians, or neoclassical liberals, have shown in their works, the projects of Hayek and Rawls were far from antithetical.  Justice is a remarkably salient organizing concept of human orders.  Hayek's trouble with social justice as an institution, I would argue, is its epistemological and ontological positioning.  A classical liberal critique of social justice rests upon its positioning in the interpretivist paradigm.  In free market economics an objectively True solution does not matter, it is the dynamic pursuit of individual and group truths that propels society forward.  

As Witt correctly points out, Hayek's main contribution to market sciences, in the mainstream view, is his appreciation of situational knowledge.  What Witt misses in this insight is the irrevocable turn to subjectivism that is inherent in Hayeks' approach to the social sciences.  Situational knowledge, which is notoriously imperfect, context-dependent, and temporary brings the study of human interaction into the subjective realm. Witt entirely misses this grounding, in Hayek's philosophy of science works--works that lay at the heart of classical liberal scholarship.  The social world is subjective and the orders we perceive are largely the unplanned coordination of human actions to produce a social whole.  

Hayek does not underestimate the externalities of a market order.  In fact, it is the market's ability to internalize these costs that is the subject of a large portion of his work.  But present in Hayek's scholarship lies a fundamental belief in the ability of subjective, distributed, individual knowledge to find better solutions to social problems than objective knowledge.  Thus, when people are starving or need medical care, classical liberals believe approaches grounded in imperfect and evolutionary knowledge will produce orders that better approach efficiency and justice.  Witt attributes Hayek's trepidation towards social justice to a fealty to Mises and the socialist calculation debate.  But he again misses the subjectivity of social action at the heart of the triumphant lassiez-faire economic system.  Were Hayek and other classical liberal scholars to incorporate the orienting principle of social justice, it would have to be a subjectivist social justice, attuned to history, attuned to institutions, and grounded in individual action.  

Social justice as it stands in practice today is, in terms of greatest power, an objectivist framework of social control that subjugates those under its rule to neoliberal efficiency, the medical model, evidence-based positivism, free-for service, and the unflinching protection of the status quo.  Those who believe the world can be ruled by people with enough of the right information are the infantry and commanders of the compassionate army.  There is little room for those who do not say "we should fix this problem" and not truly mean "the government [someone else] should fix this problem." 

Witt grades Hayek's errors by the judgment of the populace.  What does the public think of your ideas?  Witt maintains that both the traditions of Hayek and Buchanan & Tullock's public choice cannot account for the unpopularity of the libertarian or classical liberal social program.  (Aside: as if there were one.  The marketplace of ideas within classical liberalism is far more conducive to the pursuit of many competing ideas of justice... but I digress...)  Either through purposive or lazy omission, Witt ignores the works of both the fathers of public choice and its intellectual offspring.  Public choice trenchantly highlights the relative impotence of voting in achieving efficiency and justice within a democratic institution.  One person's vote is essentially meaningless on a large and even small scale.  You are unlikely to sway a local election, where there are very few important monetary decisions made, let alone a state or national election.  Interest groups run those games and their rules, as brilliantly elucidated by the public choice school, favor the well-organized, small interests.  Politicians are political entrepreneurs that bring their own entirely subjective preferences to the service of their office, usually in the service of protecting their own interests.  Finally, as the work of Bryan Caplan shows, voters have predicable biases that make them choose outcomes that are inefficient and against the interests of justice.  

Democracy for Witt, and in many other cases I come across in my studies, acts as a more relativist stand-in for objectivism and central planning.  What is true of Hayek and Mises' critique of central planning is true of democracy.  Though democracy incorporates the subjective knowledge of individuals, it is dependent on central planning in the implementations of its plans.  It is moronic to argue that all objective interventions are by their nature bad or do nothing but harm those in need.  Social justice programs in the United States such as TANF, SSI/SSDI, Medicaid, Medicare, and HUD provide deserving people with assistance they do not get anywhere else.  Their fundamental flaw, according to the classical liberal school is their structural inability to provide the rulers with enough knowledge (an impossible amount) to make the correct decision in each case.  The solution to the knowledge problem lies in the contextual knowledge of individuals.

In the present system, the positivist mandate to preserve the status quo and accept only incremental change grounded in past work limits the expression of the contextual and tacit knowledge present within the individuals in the system, as they can only act within the objectivist strictures imposed by central planners.  The planners have the measures to show whether things are working or not, what resources should go where, and who is deserving and who is not.  But these systems are all plagued by the fatal conceit--the presumption of knowledge by those in charge-- and the epistemological confusion of using positivism within the subjective realm of human affairs.  Experience teaches us that social actors produce the best outcomes when they control their own actions.  They produce robust institutions that foster social good and cooperation, increasing tolerance and peace.  

Subjectivity is the touchstone that Witt cannot see, and in balancing the theories in front of him, he comes to understand their basis in ideological commitment, rather than philosophical and paradigmatic orientation (not that the two are exclusive!).  Hayek's work on social justice is confused, defensive, and incomplete.  There are unities in his works that he did not explore and perhaps could not string together.  It has taken the work of classical liberal scholars to build and revise these contributions.  

The work on institutional analysis is foundational to a classical liberal conception of social justice.  Hayek's work in processual equity or equality before the law is important, but does not direct his attention toward the informal institutions that delimit and enable human action.  Processual equity can be better thought of as a Conservative approach to equity.  A more firmly classical liberal approach to equity is attuned toward liberty in all areas of life, not those simply economic (though those are where many of the battles are).  A liberatian institutional order I subscribe to, in the words of Peter Boettke treats people as though they are human and acts as though history matters.

Institutions from history are real.  They are orders that shape human behavior and they change rather gradually (mostly).  A libertarian can understand the potential victories for freedom and liberty in the social realm that come from an understanding of for instance rape culture, colonialism, or structural racism.  A libertarian can understand that justice is necessary in society, but his preference is for justice to be a natural outgrowth of the human endeavor--a robust approach that utilizes the situated knowledge of individuals.  Institutions are rarely perfect and are often (though not mostly) oppressive to some extent.  But it is the attention to those institutions that makes classical liberalism the appropriate grounding for social change.  The classical liberal seeks to shape the emergence of the self-correcting and self-enhancing processes that nurture knowledge best.  Though the market does not approach the idealized version of a perfectly competitive market, as Witt would likely be quick to argue, it over time produces the most stable and lasting civil society institutions as compared to those that are accomplished through objectivist central planning.  

Witt has written a certainly thought-provoking article and well worth a good read.  And I am sure he imagines himself as refuting the epistemological foundation of market liberalism.  In actuality, his neglect of classical liberal epistemology focuses his attention on the veneer of ideology, and in doing so, misses the depth of the subjectivist libertarian critique.  A just society emerges when individuals can pursue their own goals to the best of their abilities.  The structures that come from this must rely on local knowledge and a malleable institutional framework within which social entrepreneurs embody the process of social justice.  

Social Justice vs. Distributive Justice

Over at the LearnLiberty youtube channel, Matt Zwolinski (of Bleeding Heart Libertarian fame) has two characteristically well done videos on the intersection of social justice and libertarianism.  I don't really have that much to add to Zwolinski's philosophical analysis, but I have noticed a pattern with libertarian conversations on social justice.  There is a tendency to equate social justice with distributive justice.  I can think of a few reasons why this might be.  1) Libertarian social theory (in all social sciences) is largely based on economics and the logic of economics.  2) Those seeking to bridge the gap between social justice and libertarian thought are philosophers, not social scientists who operate from a different (though compatible) definition of social justice.

To expand briefly on that last point, the definitions of social justice used on the BHL website and in Free Market Fairness are focused entirely on the poor.  I don't really know enough about the development of social justice as a concept to say why that is.  The definition of social justice I've been introduced to in my social work programs concerns itself with groups facing discrimination or marginalization.  The union between these two definitions is obvious, as what group fits the latter definition better than the poor?  However, the intense focus on the poor in the former definition excludes much of social justice analysis that focuses on the experiences of minorities: feminism, racial or ethnic perspectives, LGBT theory, decolonization.

I have a few explanations for the lack of inclusion of these perspectives.  Most obviously, libertarians are loath to instantiate group rights, which some of these perspectives attempt to do.  Likewise, many perspectives propose activist government solutions to the problems they identify, problematic for an ideology that is skeptical of political solutions and increasing the scope and power of government.  Finally, there is the epistemological grounding of Austrian economics in methodological individualism, which focuses all social explanations on the actions of individuals, not groups.  This may bias libertarians against ideas that incorporate experiences of groups, rather than individuals.

As Zwolinski details very well in his first video, Hayek's dismissal of social justice is by far the most pervasive in the libertarian literature.  Briefly, the kosmos (bottom-up) market process is built upon the free actions of individuals, whose exchanges are not unjust in any way.  Therefore, how can the overall result be unjust as justice is not a property of unplanned, spontaneous orders?

While I understand the value of Hayek's analysis in defending the market process, I don't share his distaste for ends-based analysis.  As Zwolinski demonstrates well in his second video, if the ends of the market process systematically lead to the deprivation of the poor, most libertarians would not continue to adhere to this philosophy.  Ends-based analysis, which for the BHL guys means that the poor must be made better off over time, is congruent with the moral calculus of Adam Smith's Theory of Moral Sentiments.

In addition to Zwolinski's and Tomasi's ends-based analysis, there is a second group of libertarian scholars who disagree with Hayek's critique of social justice.  In order to understand these philosophers better, we must evaluate Hayek's theory as either normative or idealist.  A normative reading of Hayek serves to undergird the market forces currently in existence.  Left-libertarianism (or Free Market Anti-Capitalism) as well as libertarianism in general disagree with this appropriation of an idealist Hayek to defend a market dominated by corporatism (open coordination between government and business) and cronyism (government serving the interests of the well-informed, well-connected few at the expense of the others).  Hayek, to the left-libertarian, was appropriated by Chamber of Commerce-style Republicans in an effort to support big business and attack big government.  Hayek's ideas of spontaneous order and a free market were much more radical than anything the conservatives would ever want--true competition without government privilege.  The left-libertarians leave us with a resounding message that we do not live in a Hayekian utopia, and to the extent that there is a taxic, top-down order in society today, then there is ample room for social justice arguments.

So, having presented the ends-based and utopian arguments against Hayek's critique, we can use Austrian and Public Choice theories to construct an approach to social justice compatible with libertarian ideas.  Let's start with distributive justice arguments, focused solely on economics.  Roderick Long has argued convincingly that monetary inflation discriminates against the poor, as the new money flows into the coffers of banks, well-connected corporations, and the rich while not reaching the poor until after prices have inflated and with no overall raise in pay.  This twist on a classic Austrian argument against currency manipulation exemplifies a concern for the least well-off.

A Public Choice analysis of federal (or state) government spending in general shows how powerful, easily-organized, and well-connected groups and corporations can exploit the defects in democracy to extract billions of dollars in rents from the government without providing any net benefit to society.  These expenditures come at the expense of a minimal welfare state advocated for (or tolerated) by some libertarians.  Moreover, as I have argued in previous posts, public choice also shows how marginalization and discrimination occur and persist, as many groups face collective action problems in organizing for social change.  Groups such as the "future poor" or "drug users" have no advocates to press their interests nor any constituency to hold elected officials accountable.  Thus, marginalized groups will continue to face significant obstacles within the political order towards securing their interests.  Finally, an Austrian argument can be made that all the money spent on well-off groups and corporations is money that is deprived from market and charitable transactions.  A public choice theory critique of welfare state institutions is also possible, showing manifest rent-seeking, gaming the system, and bureaucratic self-interest, but that is beyond my aim here.

All in all, these critiques point a direction for libertarian social justice advocates to change the rules of the game.  Ending the Federal Reserve or allowing competing currency in Long's argument.  Reducing the power and scope of the federal government, by for instance, not allowing the direct election of senators.  Reinstating the Privileges and Immunities Clause to protect individuals and groups from violations of unenumerated rights.  Removing corporate privilege such as PhARMA and the insurance lobby as well as the privilege granted to the AMA, which serve to restrict competition and raise costs for the least well-off (this applies equally to my profession of social work).  This could also mean, in a more radical form, taking welfare out of the state by privatizing distribution of charitable donations or delegating that authority to the states, where individuals and service providers can have more influence over the process.  These are not a carefully culled list, but simply the ones I have gathered over the past few weeks.  It should be no secret that libertarians make social justice arguments, and it's about damn time we own up to that so we can get better at it!

Outside of the political process, I also feel there is a great amount of agreement between the Austrian focus on institutions and the social justice perspectives of minority groups.  Both focus (not exclusively) on informal  rules.  Social justice advocates attempt to change these over time, and have succeeded in doing so over the past few decades.  Libertarians, and in particular the Reason-oid cultural libertarians, applaud this progress and should work alongside these advocates as they work to change the cultural environment in which we live.  Out of this union, we may sway them from their affinity for government action or their blind belief in the democratic process.  They may sway us from our stubborn resistance to concepts such as white privilege.  There is fertile ground here, and I hope to explore it.