Beyond the Market; J. Davenport

4 Forty years ago when Nobel prize winner F. A. Hayek published his seminal tract, The Road to Serfdom, all Western Europe seemed doomed for socialization and even in the United States the case for central ized government planning ran high. Today, though governments every where continue to do many foolish things, the tide has turned. Social ists and planners we still have aplenty in our midst but they are on the defensive. The battle for the market economy has been largely won, intellectually speaking. This is an immense and hopeful turn in our thinking, presaging not only higher living standards for many of the world's societies but also a curb on the overweening power and inefficiencies of government bureau cracy. Yet there lurks in this revo lution of ideas a temptation and inBEYOND TH:E MARKET 5 deed a hidden danger. The danger is that we should come to regard the market as a kind of deus ex machina, attributing to it tasks it cannot rea sonably perform and, in that very act, avoiding the deep moral issues which confront a free society and multiply the more as freedom of choice and options multiply.

An Uncertain Trumpet On this score it would appear to me that the market, for all its healthy discipline, speaks with a very un certain trumpet. There has long been and perhaps, short of a New Jeru salem, there always will be a market for prostitution. There is a "clearing price" for cocaine and heroin no less than for the more beneficent Coca Cola. Free marketeers may argue that the profits of the drug trade and the pusher might be minimized by legalizing such drugs but this is a tactical point. The case against her oin is the same as against murder or suicide: it kills. Moreover it turns out that the market itself, to be efficient, is de pendent on a whole matrix of cus toms, laws, and moral convictions as to what is right and what is wrong. In his essay on "Our Moral Heri tage," Hayek points out that the market and the free society are de pendent on at least two institutions and one virtue. The first is the le gitimacy of private property without which there could be no capital accumulation or indeed capitalism as we know it, or for that matter much civility. Mark in this connection the high price we pay today for the spread of petty larceny which has brought in its train the security guard, the noxious office pass sys tem and, incidentally, a booming trade in all manner of electronic de vices to prevent burglary.

More interestingly Hayek pays tribute to the family as the means by which one generation passes on its experience and values to the next. Finally he has a good word to say for plain old-fashioned honesty, and one is glad to hear it mentioned. I call up my broker to buy or sell General Mo tors. He executes the order with no more than the sound of my voice as security. True, if either of us proved dishonest, legal action could be taken. But if we had to wait for the courts to decide such issues it is fair to say that the New York Stock Ex change would close down tomorrow and our intricate banking and credit system would collapse as well. Beneath the Hidden Hand The paradox thus emerges that while the market does not always generate ethical values, it is deeply dependent on them for its efficient functioning. This paradox has enor mous significance in maintaining the free and open society whose cen tral challenge is to grant liberty to individuals while still maintaining 6 THE FREEMAN January order and continuity in our affairs.

The great contribution of Adam Smith was to show that if citizens are free to follow their own self-interest they will be led "as by an invisible hand" to fulfill beneficent social pur poses that were no part of their orig inal design. But this faith in the in visible hand never led Smith to doubt the legitimate functions of government in enforcing the rules of the road. More important, his whole philo sophic outlook implies one further factor that tends to go unnoticed namely, the widespread acceptance of moral and indeed religious imper atives which in the England of his day were taken almost as a matter of course. It is these that have been undermined by what Walter Lipp mann once called the "acids of mod ernity" and their reinstatement is required if the market is to fulfill its promise. Pretty clearly that job lies beyond the purview of economists however well equipped with de mand, supply, and indifference curves.

The Greek Way The late Frank Knight, Nestor of what is today known as the Chicago School of economists, was fond of quipping that the less moral issues were talked about the better, since they defy rational determination. But the men who launched philoso phy on its wayward course, and who laid the foundations of logic, ethics and metaphysics, were subject to no such restraint. Living in Athens of the Fifth and Fourth Centuries B.C., they saw plenty of freedom around them, if we disregard the institution of slavery, but disliked what they saw: luxury, vice and the awful treachery of Alcibiades. Hence Soc rates' constant reference to the "in ner voice" of duty in his endless ar guments with the Sophist Thra symachus who cheered for mere self interest and the doctrine that "might makes right." Hence Plato's invo cation of the overarching concept of the Good in his delineation of a Spar tan republic. Hence, finally, Aristo tle's argument that the end of man is Happiness, but Happiness achieved through the pursuit of ex cellence and virtue.

Libertarians who of recent years have borne the heat of the day in trying to restore sanity to our eco nomic affairs may well view with suspicion these Greeks bearing gifts. For admittedly there is scarcely a governmental folly of our times that has not been committed in the spe cious name of "reform": the fair wage and the just price and the wel fare state. More generally one must guard against those who think they have a monopoly on virtue and then invoke the power of the state to fur ther their views. This is the sin, if it can be called such, of the Moral Ma jority who hopelessly mix up prin1985 BEYOND THE MARKET 7 ciple with pressure group tactics. Governor Cuomo of New York was quite right when he argued that his views on abortion as a Catholic gave him no license to legislate what many Catholics may not be able to enforce on themselves. Something might even be said for Thoreau's avowal that he would take to his heels if he heard that someone was coming to do him good.

Liberty Is a Gateway Nevertheless I would argue that the classical emphasis on ethical norms and standards is critical to our times and complements rather than contradicts the best of the libertar ian tradition. Liberty is a gateway, not a resting place. Its use or abuse has far-reaching political conse quences. The sharing of ideals may be of greater importance than the much discussed sharing or non-shar ing of wealth. Aristotle's Golden Mean-nothing too much-was a crude attempt to re store harmony in men's conflicting desires and passions. With the com ing of Christianity, the Golden Mean gives place to the Golden Rule-do unto others as you would be done by-and to Kant's categorical imper ative: treat others as ends, never as servile means. The truth is that Freedom and the Good are two in terdependent concepts in tension, and one will spin out of orbit without the other. The question remains as to whether morality requires buttress ing by religious faith. The Declara tion of Independence implies as much by its reference to the Creator and to the "laws of Nature and of Nature's God." But we all know of many good men who are today held back from this final leap, whether through dissatisfaction with current orthodoxies, the sad "politicizing" of our churches as evidenced by their most advertised National Council, or through the fact that faith- "the substance of things hoped for; the evidence of things not seen" -so clearly transcends the power of rea son. Yet there lurks here an even more important obstruction: the ten dency of modern science, or in Hay ek's phrase "scientism," to over reach itself and so make both religion and morality irrelevant.

Two heresies of Western origin must be discarded if we are to preserve freedom of religious choice as guar anteed by the Constitution. The first is the clanking materi alism of Marx which might not have to be taken seriously were it not to day armed with ICBMs. The 'second heresy is found, curiously, in modern Behaviorism. Behaviorism starts with the common sense notion that if we are to study man, we must take account of what he does no less than what he thinks and says. In the hands of John B. Watson and now of B. F. Skinner, behaviorism becomes 8 THE FREEMAN something quite different. Because body and brain are associated with consciousness, we must, on Skin ner's view, eliminate the latter en tirely from the discourse. Conscious ness, mind, willpower, emotion-all that makes man man-is swept away. The human being becomes simply a series of knee jerks in a mindless universe, the Fifth Sym phony simply horsehair scraped over catgut.

Needed: A New Metaphysics This naive and indeed impudent reductionism is not science, which requires a perceiver no less than the perceived. It is a false metaphysics as old as Democritus who conceived of the universe as only a whirl of at oms. As Alfred North Whitehead once intimated in his Science and the Modern World, what is needed is a new metaphysics that would rec oncile empiricism with man's inner apperception of self-hood and his higher aspirations. Such synthesis of new and old may well come, re storing, if not God in his Heaven, at least faith in the mystery and reality of the many-colored world around us from which scientist, artist, and the ologian make their start. When that breakthrough comes, it will outrank in importance the discoveries of Cop ernicus and Galileo. Meanwhile, in view of political turmoil without and intellectual dis cord within, it would appear that lib ertarian and Classicist, modern sec ularist and religious believer, face a considerable task in the immediate future: to honor Adam Smith's in visible hand as against the mailed fist of the tyrant; to reaffirm the dignity and indeed the sanctity of the individual person; to hold the bar barians, who have said they come to bury us, at the· gate and so preserve what Winston Churchill in a dark hour defended in the name of West ern Christian Civilization. ~ lDEASON LIBERTY Freedom as a Moral Principle THE most important among the few principles of this kind that we have developed is individual freedom, which it is most appropriate to regard as a moral principle of political action. Like all moral principles, it de mands that it be accepted as a value in itself, as a principle that must be respected without our asking whether the consequences in the par ticular instance will be beneficial. We shall not achieve the results we want if we do not accept it as a creed or presumption so strong that no considerations of expediency can be allowed to limit it.

F. A. HAYEK ~ John Hospers Justiceversus "SocialJustice" IT is individual human beings who are born, live, enjoy, suffer, and die. Individuals sometimes band to gether into groups; but groups as such do not live, love, or suffer; only their individual members do. The in dividual, not the group, is the unit. Individuals interact with one an other, in families and larger socie ties. Sometimes they act wrongfully toward others; and one kind of wrongful action is called injustice. But what does this mean? What pre cisely is involved in an action being just or unjust? Justice, in a tradition going back John Hospers is a professor of philosophy at the Uni versity of Southern California, Los Angeles. He is the author of numerous books, such as Human Conduct, Understanding the Arts, and Introduction to Philo sophical Analysis, as well as several anthologies and more than one hundred essays in journals and en cyclopedias. He is president of the American Society for Aesthetics, and was the first Libertarian Party candidate for U.S. president (1972). He is editor of the philosophical quarterly The Monist.