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.