Chill Out, Hayek! – Part 1

In The Reactionary Mind, Corey Robin claimed – drawing on Naomi Klein and Greg Grandin – that Hayek “admired Pinochet’s Chile so much that he decided to hold a meeting of his Mont Pelerin Society in Viña del Mar”, the seaside resort in Chile where General Pinochet’s CIA-assisted military coup against the democratically elected left-wing government of Salvador Allende was planned.  This claim was denounced on Twitter as “made up” by none other than ‘@FriedrichHayek’ himself!  (Probably just a fan rather than the man himself resurrected and tweeting… as usual, Hayek’s admirers simply deny his complicity with the Chilean junta, when they can’t get away with just neglecting to mention it.  As Robin discovered, they have lots of excuses – he was an old man at the time, etc – all of which turn out to be so much bad faith when you look at them.)  Checking, Robin discovered that it is more accurate to say that Hayek attended the meeting where the decision to hold the MPS’s 1981 conference in Viña del Mar was made and, at least, did not oppose it.  His position in the Society was still prestigious enough that, at the very least, an objection from him would carried a lot of weight.  No such objection seems to have been forthcoming.  And indeed, we’re being scrupulously fair to the point of charity by even being this circumspect.  Nothing in Hayek’s behaviour suggests he would’ve been likely to object.

Hayek had already been to Pinochet’s Chile – a laboratory for the experimental free-market neoliberalism of Milton Friedman and the ‘Chicago Boys’ – in 1977 to receive an honorary degree, and to lecture.  Hayek spoke to the public and, says Robin, to “businessmen and government officials, including Pinochet himself”.  

He described the leaders of Chile under Pinochet as “educated, reasonable, and insightful men”.

The admiration was mutual.  Robin uncovered subsequent letters to Hayek from his hosts, business academics who were also high-ranking people in the junta, fawning over Hayek, telling him how influential his ideas were in their country, including in high circles, and proposing that the MPS hold their 1981 meeting in Chile.  

To quote from the Austrians essay, to be included in Phil’s forthcoming Neoreaction a Basilisk:

And so it came to pass.  Numerous luminaries of conservatism, free-market fundamentalism, and the dawning neoliberal counter-revolution attended.  They hobnobbed with the top brass and the big bankers of Pinochet’s dictatorship, along with the regime’s fellow-traveller intellectuals.  They enjoyed the opera.  They drank wine.  They pontificated about the much-maligned land of Chile, and – like any starry-eyed communist fellow-traveller of the 30s who’d just visited the Soviet Union and taken care to look at it only through the slim gaps between their fingers – they came away convinced that they’d glimpsed utopia.  A utopia in which thousands of political dissidents had been, and continued to be, ‘disappeared’ into a grotesque, institutionalised system of state-run torture, rape, and murder.  Not that the MPS people denied the tyranny.  On the contrary, they acknowledged and praised it.

The tyranny was, says Robin, “held up as a point in Chile’s favor—at least in comparison to America, whose electoral democracy might prove a major obstacle on the road to Mont Pelerin.”  

As to Hayek’s role in choosing the venue, Robin concludes:

A full three years before the MPS meeting was held in Viña del Mar, and a full two years before the MPS Board voted to hold it there, Hayek—who was honorary president of the MPS and a board member—was  brought in on ground-level discussions by what seem to be the two originators of the idea. I was not able to find any other record of a high-level MPS official being consulted; from the point of view of the Chileans, Hayek was the man to convince.

It’s no surprise that Hayek should have no strong objection to honouring Pinochet.  A few months after the MPS conference was held in Chile, he passionately attacked the Frankfurter Allgemeine Zeitung for publishing a cartoon critical of Pinochet’s regime, saying they’d fallen for “socialist calumnies”. 

To quote myself again:

He later wrote to the Times that he’d been unable to find anyone in Chile who didn’t feel more free than they had under Allende. This is unsurprising, given the circles he moved in.  Besides, by then Pinochet had already had all the people likely to complain rounded up and shot.

It should be recalled that all of this is around the same time Hayek criticised the British Liberal Party for entering into a pact which kept the Labour government in office in the UK. Writing to the Times, Hayek said, “May one who has devoted a large part of his life to the study of the history and the principles of liberalism point out that a party that keeps a socialist government in power has lost all title to the name ‘Liberal’. Certainly no liberal can in future vote ‘Liberal’”.  It could hardly be more revealing.  Apparently, a strategic pact with left-wingers within the confines of an electoral democracy is a betrayal of liberalism, but a military government rounding left-wingers up in football stadia and killing them, or setting up entire ministries devoted to sexual torture, isn’t.

In his letter to the Times, Hayek wrote

If Mrs. Thatcher said that free choice is to be exercised more in the market place than in the ballot box, she has merely uttered the truism that the first is indispensable for individual freedom, while the second is not.

In the same letter he writes that there are “many instances of authoritarian governments under which personal liberty was safer than under many democracies”.

As Corey Robin says after quoting Hayek thus, this “statement is certainly in keeping with much of what Hayek wrote throughout his career” and is an unusually explicit statement of “his belief that capitalism is more important to freedom than democracy”.  As I pointed out in the last essay, Hayek was perfectly well aware of the need to be covert about his anti-democratic sympathies, tactfully circumlocuting around his debt to Carl Schmitt even as he quietly praised him.  Later in life, as often happens, he began to lose his inhibitions.

Hayek visited Pinochet’s Chile several times.  On one visit he accepted the title of Honorary Chairman of the Centro de Estudios Públicos (Center of Public Studies), a Chilean free-market think tank set up in 1980.

Robin quotes an article called ‘Preventing the ‘Abuses’ of Democracy: Hayek, the ‘Military Usurper’ and Transitional Dictatorship in Chile?’ by Andrew Farrant, Edward McPhail, and Sebastian Berger, published in the American Journal of Economics and Sociology:

Though Hayek’s 1981 interviews with El Mercurio have attracted much attention, scholars have ignored El Mercurio’s coverage of Hayek’s initial visit to Chile in 1977. In particular, El Mercurio notes that Hayek—quoted as saying that Chile’s efforts to develop and reform its economy provided “an example at the global level” (1977: 27)—had met with Pinochet: “At the end of his visit . . . Hayek . . . was received by President Augusto Pinochet. He [Hayek] told reporters that he talked to Pinochet about the issue of limited democracy and representative government. . . . He said that in his writings he showed that unlimited democracy does not work because it creates forces that in the end destroy democracy. He said that the head of state listened carefully and that he had asked him to provide him with the documents he had written on this issue.”

…

According to Hayek, Pinochet had requested copies of Hayek’s writings (“documents”) explaining why unlimited democracy would inevitably lead to the destruction of democracy (1977). Consequently, Hayek asked Charlotte Cubitt (his secretary from February 1977 until his death in 1992) to send Pinochet a draft of Hayek’s ‘A Model Constitution’ (Cubitt 2006: 19). Importantly, Hayek’s chapter—‘A Model Constitution’ (1979b: 105–127)—provides a three-page discussion of the conditions under which the adoption of Emergency Powers (124–126) and the suspension of democracy are supposedly justified: The “basic principle of a free society . . . [“the coercive powers of government are restricted to the enforcement of universal rules of just conduct”] . . . may . . . have to be temporarily suspended when the  long-run preservation of that order [the free society] is itself threatened” (1979b: 124).

…

When Hayek visited Chile in 1981 he “took time off from his official commitments to walk around and see for himself whether people were cheerful and content. He told me that it was the sight of many sturdy and healthy children that had convinced him.”

…

As Hayek notes, “democracy needs ‘a good cleaning’ by strong governments.”

…

The Pinochet junta “enacted a new constitution in September 1980. . . . The constitution was not only named after Hayek’s book The Constitution of Liberty, but also incorporated significant elements of Hayek’s thinking.”

As Farrant et al point out, Hayek also had a great deal of sympathy for the Apartheid regime in South Africa, and for similar reasons.

To once again quote from my (and Phil’s) own forthcoming essay:

Hayek wrote to Margaret Thatcher herself (already a fan of his, as we know from her legendary book-thumping) in an ecstasy, recommending that she institute Chile-style policies in the UK. She responded (essentially) that she’d love to, but they had this pesky thing called ‘democracy’ in Britain which would get in the way… especially, one suspects, since she was already sinking in the polls and ‘shock therapy’ (let alone bloody repression) wouldn’t help. In the end she found the solution to her electoral woes in some contrived blood-letting abroad, against – ironically enough – a South American country. She used jingoism to get herself re-elected by climbing a pile of corpses, and then used her mandate to declare war on “the enemy within”. This referred specifically to the miners, but more generally to anyone – especially anyone working class and organised – standing in the way of her unleashing as much of Hayek’s Chilean prescription upon the country as possible. What followed is well-known, and is a vital part of how the world got to the point where neoliberalism reigns supreme, free-market orthodoxy is unchallengeable anywhere near significant centres of Western power, and we slide towards the edge of the ecological cliff without any real willingness to look for any handholds that might still be there to grab.

It’s worth noting in passing that, despite still being held up by ideologues as an example of free market economics rescuing an economy, Pinochet’s Hayek-and-Friedman-inspired economic ‘shock therapy’ (to use Naomi Klein’s appealing, if theoretically fuzzy, phrase) actually drove Chile into a catastrophic economic crash. This was only alleviated by a distinct change of policy direction – including re-nationalising loads of the industries Allende had nationalised and which Pinochet had re-privatised after taking power. It was only after this that Chile started to become the success story that the free-marketeers still get the credit for.

But evidence isn’t a consideration for these people, as we’ve established.  Instead, the reasoning is from first principles, i.e. democracy leads to totalitarianism.  Hayek gets this from Mises and reiterates it throughout his work.  It’s in Road to Serfdom.  It’s in Law, Legislation and Liberty.  It’s where he ends up as a result of the reasoning and assumptions we’ve already looked at in that book.  He sees central planning as the result of democracy, central planning as socialism, and socialism as inherently totalitarian.  So you support the authoritarian crackdown on the process.

In a 1981 interview with Renee Sallas of Chile’s El Mercurio newspaper, Hayek says this explicitly:

All movements in the direction of socialism, in the direction of centralized planning, involve the loss of personal freedom and end up ultimately in totalitarianism.

…

[A]s long-term institutions, I am totally against dictatorships. But a dictatorship may be a necessary system for a transitional period. At times it is necessary for a country to have, for a time, some form or other of dictatorial power. As you will understand, it is possible for a dictator to govern in a liberal way. And it is also possible for a democracy to govern with a total lack of liberalism. Personally, I prefer a liberal dictator to democratic government lacking in liberalism. My personal impression. . . is that in Chile . . . we will witness a transition from a dictatorial government to a liberal government . . . during this transition it may be necessary to maintain certain dictatorial powers, not as something permanent, but as a temporary arrangement.

As Robin notes, following Farrant et al, Hayek was trying to offer help to Portugese dictator António de Oliveira Salazar as early as 1962, sending him a copy of The Constitution of Liberty (recently sporked on this very website and thus revealed as a concatenation of incoherent and purblind snobbery) to help inspire “a constitution which is proof against the abuses of democracy”… by which he means those abuses democracy inflicts upon a state which tries to intervene for anything but defence of individual liberty (i.e. property).

Superficially, all this looks like a contradiction with Hayek’s loudly espoused support for liberty, his anti-totalitarianism, etc.  But it actually follows from such first principles.  It’s what happens when your first principles are abstract and ahistorical, and you apply them without conscience.