Also, don't forget you can now buy Phil's new book Neoreaction a Basilsik (featuring a chapter I contributed to) on Kindle and in dead tree format (Amazon US, Amazon UK). It's a more enjoyable read than Hayek. Fucking trust me on this.
Hayek’s position on Chile, and on reactionary authoritarianism generally, is the dollfussian logic of Mises working itself out, i.e. the Left makes a kind of temporary recuperative fascism necessary. Mises developed this view when collaborating with the anti-Nazi and anti-Communist 'Austro-fascist' Dollfuss.
None of the assumptions are especially non-mainstream – which tells us something terrifying about the mainstream – but Hayek synthesises them, accepts their implications in a principled (yes, in his own vile way he is principled) and non-opportunistic way, and takes them to their logical conclusions. If liberty is threatened by democracy leading to socialism leading to totalitarianism (Nazism being socialism too according to Dollfuss and Mises et al – another argument we still live with) then you need authoritarianism to quash democracy when it goes too far. We’ve already seen Hayek adapting the ideas of (ironically) Carl Schmitt to this end. And Hayek is employing the same distinction between totalitarianism and authoritarianism which provides a moral logic to those ideologues of Western imperialism who advocate supporting ‘strongmen’ against official enemies. It’s the same logic that leads Kissinger and Nixon and the CIA to support Pinochet. And this is just one of many examples. Ironically, it also leads to the same rhetoric that advocates ‘humanitarian intervention’ against (sometimes) the same strongmen when they outlive their usefulness. It’s an ancestor of the arguments of Bush II and the Schmittian-Straussians, of Bernard Henri-Lévy and the ‘Nouveaux Philosophes’, of Hitchens and the New Atheist Islamophobes and the ‘Decent Left’. ‘Islamofascism’, etc. Imperial praxis, in other words. How ironic that the great philosophers of libertarianism provide a ideological bedrock for the wars libertarisns so often to profess to oppose.
Hayek is not the cause of such praxis, but he’s a synthesizer of it, and his syntheses then feed back in as ideology. And the ideology arises from the economic system, hence the axiomatic and foundational belief in the identity of capitalism and liberty. The class nature of the ideology is clear when you remember that Hayek lambasted left-wingers who were prepared to countenance the idea of ‘temporary’ suspensions of democracy as ‘stages’ towards socialism, etc. Particularly egregious, since he justifies his own support for dictatorship by calling it a necessary transitional phase. But there isn’t actually any hypocrisy here. He sees it as fundamentally different to support a tyranny for capitalism than a tyranny for socialism, and he’s right. In its way this is just a recognition of the often-forgotten fact that politics has content as well as form. And he’s right that authoritarianism is necessary to support capitalism. It always has been. Capitalism has always depended upon state violence and the suppression of democracy. Again, the irony. The philosophy of free-market anti-statism reveals how capitalism and the authoritarian state are inextricable.
This 'inextricability' has never been more true than under the neoliberal system that Hayek helped pioneer. It is based on Hayek and Schmitt’s extreme right-wing critique of democracy and redistribution. The logically consequent idea that emergency dictatorship may be necessary to preserve liberal society from democracy runs right through neoliberalism.
Pinochet’s Chile is thus a key part of the neoliberal origin story. Beyond its use as a lab for monetarism and ‘disaster capitalism’, etc, it also helps us identify a crucial origin point of neoliberal praxis, via where the ideology of its great intellectual supporter both inspires and justifies it, and then goes on to provide a basic grammar to neoliberal ideas.
“Clearly,” says Richard Seymour,
the ‘liberty’ upheld by the Mont Pelerin Society… is not political liberty. It is not the liberty to participate in the politics of a society. It is the liberty to engage in market transactions, to buy and sell on terms set by ‘the market’. It is the liberty to be at the mercy of ‘the blind force of social process’, as Hayek put it. Yet this ‘blind force’ is only apparent. The phrase implies that the economy is akin to a natural system, driven by brutal, merciless physical laws. And indeed, there is a tendency in neoliberal ideology to explain ‘the market’ as a pitiless evolutionary system, weeding out the weak and inadequate through competition and selection.
The ‘blind force’ is assumed to not be coercion at all, because it is market coercion. That freedom of markets is simply assumed and then used to prove itself. It’s a higher form of freedom than mere political freedom, thus political freedom can be dispensed with in the name of protecting market freedom. Spontaneous order contains a self-justifying Darwinian aesthetic. This aesthetic is exactly the same one that feeds into socio-biology, and – to verge into the comedic – into reactionary YouTube atheism, which is relevant to us because it’s an alt-Right vector. Social Darwinism contains a shrug of ‘that’s just the way it is’, and from there we get to “fuck your feelings”. The ideological benefits of applying this to the market are obvious, and the market invites the comparison because it really does work like a brutal Darwinian system… until, of course, the state gets involved in rigging it. Which it has always done, or capitalism wouldn’t be here. And will always do, as long as capitalism exists. (And look, yet another ironic revelation of the hypocrisy and vapidity of the ideology. The libertarians profess to admire capitalism untampered-with, and to despise capitalism ruined by state intervention. But their own system is untenable without state intervention. State intervention thus plays a dual role: eternal buttress and eternal butt of blame. But in reality, free-market ‘anti-statism’ really is like dreaming of evolution without pain or biospheres without bacteria.) In reality, the state’s fix is almost always in the service of capital. And even when it isn’t, this usually has to be forced on the state by pressure from below. And even then, the state usually only complies when it needs to in order to safeguard capitalism in the bigger picture. But hierarchy always effaces its bigger slice by pointing at someone else’s crumbs and screaming “no fair!” And capitalist ideologues rail against the state that safeguards them like a stroppy child, furious that Mum and Dad won’t let them have chips absolutely every meal.
Hayek’s metaphysical view of the market as the arena where human morality, value, and worth are manufactured (see later installments); the social Darwinism entailed by the idea of ‘blind force’; the effacing of the role of the state; the suppression of democracy in the name of freedom via markets, and thus the propping up of the market system through authoritarian statism in every arena other than regulation of capital… these all ended up in neoliberalism’s source code, and Chile was an important early experiment. That it was employed as counter-revolution, and had to be enforced through torture and massacre, tells us a lot. This isn’t the genetic fallacy. This is a material account of speciation.
Corey Robin suggests that Hayek is engaged in a hypocritical “betrayal of his own beliefs” when he supports dictatorships. But surely, if liberty is constituted of capitalism, and capitalism is threatened by democracy, then it is a fulfilment of the most dearly-held beliefs of the libertarian when he crushes democracy. The libertarian looks at what we see as betrayal, or irony, raises his eyebrows, and says "Yes? What of it?"
Robin also seems to think that Hayek is betraying his own theory of society, i.e. ‘spontaneous order’. Easily mistaken for a dialectical account of social evolution as comprised of social forms as emergent properties of blind processes, it actually resolves down into little more than a defence of tradition and inherited values, of the veneration of the accumulated wisdom of forefathers, etc. (In this it is similar to the Austrian idea of 'roundaboutness' in production, which looks superficially like an introduction of time into the static formulas of marginalist economics, but actualy just treats time as another abstraction... and the Austrian idea of 'lopsided production', which seems to be an acknowledgement of overproduction but is actually just a way of avoiding the Marxian insight that overproduction is general, by pretending that what happens is that one bit of the mechanism comes out of true.) But the actual claim being made by 'spontaneous order' is that it is thus impossible or undesirable (or both) to try to engineer society, to plan it, to change it. This is clearly an ideological manoeuvre designed to foreclose upon the idea of economic planning, and therefore of democracy, and therefore of interfering in the prerogatives of the propertied. Any form of ‘tinkering’ is off limits, from a democratic government trying to control the economy for the public good (or indeed for any aim other than the aims of capitalists), or a revolutionary transformation of society in which the masses remake the world.
It’s no wonder Hayek sees Stalinism as essentially the same as Labour governments in Britain, or that he can’t see the difference between either of them and what Marx was arguing for, i.e. actual collective democratic control by workers… because, reasoning abstractly and axiomatically, he doesn’t see the material differences. He’s slipped back into politics as form rather than content. He sees only the plan, the attempt to impose conscious control. Which is doomed, because social order is spontaneous, and evolved. Which proves that "what is, is right". What has come down to us is the best that can be. But there are people who want to meddle with it. Paradoxically, then, it must be helped to be itself. This is key. When reactionary authoritarianism is used to reimpose market rule (supposedly, but not actually, because market rule is a mirage as much as equilibrium) that is not intervention... or rather it is, but it is permissable intervention because (supposedly) it puts things back the way they were before the (illegitimate) intervention of others. How do you know their intervention is illegitimate? They tried to plan things, and to redistribute some wealth. It's a tautology. You know it's wrong because it is. You then do your own version of the same thing, but in the opposite direction, and you know that's right... because it is. Why are the efforts of planning not part of spontaneous order? Why is democracy not part of spontaneous order? Social justice is an idea imminent, in various forms, in current society – why is it, in Hayek’s words, a “mirage”? Why are even those aspects of statism which are essential to capitalism – past and present – written out of the ideology? These are all simply glossed over.
Actually, to an extent, Hayek does see democracy as part of spontaneous order. He is not ideologically opposed to democracy per se. He is not, for all his openness to authoritarianism, and the fascist flirtations of his tradition, an actual fascist. He's a classical liberal. I don't want people to mistake him for a fascist. I want people to see, in Hayek, how close classical liberalism can be to fascism, how fascism is - in many ways - an outgrowth of classical liberalism, a weaponization of its imperatives.
For Hayek, democracy is a tool that can be employed, or not, as convenient, as and when constructive. Whereas for Marx democracy is the ultimate principle and goal, and his basic political critique of bourgeois society is that it develops a limited democracy – under pressure from the masses, and its own contradictory needs – and then contains and curtails it, Hayek’s critique of actually existing capitalist society is that it accidentally encourages democracy to get out of hand.
It’s core to Austrian dogma that the general good cannot be calculated. You just have to derive what general good is possible from letting the completing claims fight it out. In that fight, some will be advantaged – but that’s because the better claims accrue advantages. You know they’re better because they’re winning. Tautologies again, but what could be a more praxeological statement that “whatever is, is right”? The Austrians are latter-day Panglosses… but scared ones.
The “mirage of social justice” (the subtitle of the second volume of his Law, Legislation and Liberty) arises from the freedom market society brings, and threatens to get out of hand, to become an unbalanced part of the spontaneous order. To him, then, putting democracy back in its box when it becomes dangerous statist-planning tendencies, is just realigning the order. As noted previously, his preferred form of the authoritarian ‘exception’ would be a return to the 19th century liberal state rather than actual fascism. Putting its spontaneity back into place, by hand. The proper alignment, the spontaneity, is inherently and axiomatically, the containment of democracy in the interests of the propertied class. It’s worth remembering that Hayek’s beloved 19th century liberal state was born of slavery and primitive accumulation, built on empire, and bitterly resisted the enfranchisement of the masses. As Aime Cesaire (and Fanon) pointed out, fascism is in many ways just the rule of classical liberalism abroad (i.e. imperialism) relocated to Europe and inflicted upon white people.
This is where we get to the real first principle, the real axiom. It’s not actually that Hayek is reasoning policy from the axiom of spontaneous order, or support for Pinochet from his conception of the distinction between totalitarianism and authoritarianism, or any of that. Spontaneous order is actually an assembled, reiterated expression of the Calvinistic class-based ideology that we meritocratically end up where we’re supposed to be because, through struggling to succeed, we learn our proper destiny. It is one way in which the rising bourgeois classes ideologically expressed the idea that proper order could be arrived at through market relations. Let the market rip through society, let unfettered competition rule, let the bourgeois class rise. The people who are at the top of the resulting spontaneous order are the ones who worked and fought and believed hardest, which reveals them to be the Elect.
Though it arose in a specific time as an expression of specific class interests, the ideology has carried on, it has been carried forward. It remains useful as a cultural logic. Using it, you can claim that it is possible to tell where someone was meant to be by where they end up. This is, as we’ll see, is central to Hayek’s metaphysical view of the market, drawing on Mises. It is a central logic of the Austrian tradition - hence the entailed support for innate hierarchies amongst people, which will fructify into the bitterly racist and sexist fruit of paleolibertarianism, itself arising from the Austrian trend. The great movers of society are the entrepreneurs, and this assertion is justified by reference to their ‘tacit knowledge’, i.e. their ability to know and choose dynamically, without reference to a wider body of social understanding. The tacitness of their knowledge is mirrored in the tacitness of the rules of society, stemming from their self-assembled, unplannedness. The anarchy of the market is thus fetishized beyond sanity.
Clearly, Hayek sees the world as having developed into an inherently creative state of aggregated individual liberties. But this world is under constant threat – another quintessential trait of conservatism is the eternal fear of losing the valuable world one has, maybe even owing to weakness on your part. Indeed, anxiety about the weakness of the older and better order is a key psychological component of reactionary thinking, as Corey Robin has demonstrated. The Mont Pelerin Society, and the subsequent neoliberal coalition and project, are responses to the threats to the spontaneous order that accreted over time, the vast well of inherited traditions and tacit knowledge, and the relations which enshrines them in power. Hayek’s activist projects are thus variations of what Pinochet did in Chile. Interventions designed to reimpose the natural, evolved, spontaneous order – i.e. the ascendancy of bourgeois relations – after attempts, inherently artificial, have been made to centrally plan that order away. There is no contradiction in the idea that such attempts are also inherently unworkable. The Mises-Hayek side of the Calculation Debate (the argument that planned economies can't rationally allocate resources) is based on the idea that an existing system of planning is going to decay, and thus we must resist the spread of all planning. The anarchy of market relations is thus enshrined as the only long-term possible system, and one which must be protected. It is not, as Foucault said, that neoliberals don’t really believe in spontaneous order. It’s rather that spontaneous order must be protected by well-planned and well-organised force, both in policy and violent intervention. Such contortions are possible precisely because it isn’t the ideas – the theoretical expressions, the ideology – which drive the practice, but rather the other way around. Because the practice stems from the interests and allegiances, which are material interests, class interests.
The foundational irony is that axiomatic, first principles reasoning is actually an expression of material interests, behind their own back but in their service. The conclusions they draw from their axioms actually go to support Bukharin’s observation (in his critique of Bohm-Bawerk and infant marginalism) that subjective calculations of value are always in reality not purely individual but actually socially embedded. Hayek derives spontaneous order from class interests, not policy that just happens to serve capital from the abstruse philosophical idea of spontaneous order. He is not even reasoning from the first principles of Austrian economics – nor more than Mises really derived his economics or politics from praxeology. The real first principle, the real axiom from which they argue is the class struggle, from the principles of private property, and thus the material interests of the ruling class. He understands that its capital that rules, and that this has to be enforced. As Marx says “between equal rights,” by which he means competing claims in the marketplace, “force decides.” And the people with the force are, by definition, the people who run the market.
What is really happening here is an elevation – via a fetishized view of capitalism that believes its own myths and elevates the anarchy of production into a universal principle of creation – of the agency of the ruling class. The metaphysics are derived from the material interests, not the other way round.
But that’s marginalism for you.
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