From Free Life, Issue 20, August 1994
ISSN: 0260 5112
Beyond the New Right: Markets, Government and the Common Environment
Routledge, London and New York, 1993, 206 pp, £19.95/$35.00
(ISBN 0 415 09297 3)
This book has been described by one of my friends as an “intellectual disgrace”. And, speaking for myself, Mr Gray’s fast decline from Libertarian Alliance author to cheerleader for Tony Blair has been a disappointment. So far as I can tell, he has in the past five years been a libertarian, a classical liberal, a conservative, a green, and may now be some kind of social democrat.
Nevertheless, a man ought surely to have the right to change his mind, even though very much for the worse. I will also say that the book should be of interest to anyone who belongs to the vague anti-statist coalition known as the “new right”. For here is a long and often bitter denunciation from someone of undoubted ability who yet knows what he is writing about. So far as Mr Gray claims to have exposed weaknesses on our side, his arguments deserve serious consideration. So far as these arguments can be answered, we shall have further grounds for believing that, broadly speaking, we are right.
This being said, I proceed to a brief consideration of Mr Gray’s arguments. His chief attack is against three alleged assumptions:
First – that a free market is what remains when all constraining laws and customs have been swept aside. This is not the case. Markets often do emerge spontaneously, as expressions of human nature; but they do not emerge from nothing. They are not “free-standing entities…” but
legal artefacts [sic], sustained by cultural traditions and sheltered by governments. [New Right thought] did not grasp that markets fail insofar as they are not underpinned by trust, integrity and the other virtues of fair dealing. (p.viii)
Without these cultural traditions, the ending of one oppressive system will lead simply to a period of chaos followed by the emergence of some other system that may be no less oppressive, or even more so. The mafia-ridden “free markets” decreed into being throughout the former Soviet Empire are cited as an example of this tendency.
Second – that
The functions and limits of state activity can be specified, once and for all, by a theory, instead of varying with the history, traditions and circumstances that peoples and their governments inherit. (ibid)
This theory is most often
The doctrine of the minimal state, which asserts that the sphere of government action is exhausted by the protection of negative rights. (p.5)
The problem here is that these negative rights cannot be given a universal, internally consistent meaning. Any discussion of laissez-faire suffers
from the disability that that principle is itself practically vacuous. In civil society, the sphere of independence is constituted by a most complex structure of legal immunities, forms of property and personal and economic liberties – a structure whose specification is given to us by no general theory. The contours of the sphere of independence are not natural truths, but instead artefacts [sic] of law and convention, subject to the need for recurrent redefinition and often expressing a balance between competing interests and values. (p.6)
Moreover, even if the scope of a minimal – or zero – state could be practically agreed, there is the certainty that it could never exist. People expect more of government than the prevention of force and fraud. They need something with which they can identify – something that they can love for its own sake, and be prepared to kill or die for. A minimal state may be tolerated so long as it delivers rapid economic growth. Let the speed of improvement falter, or go into reverse, and it will have no remaining source of legitimacy. I hope Mr Gray will pardon me if on this point I quote from Burke:
On the scheme of this barbarous philosophy, which is the offspring of cold hearts and muddy understandings, and which is as void of solid wisdom as it is destitute of all taste and elegance, laws are to be supported only by their own terrors, and by the concern which each individual may find in them from his own private speculations, or can spare to them from his own private interests. In the groves of their academy, at the end of every vista, you see nothing but the gallows. Nothing is left which engages the affections on the part of the commonwealth.1
Third – that free markets are a universal panacea.
The mark of imperfectibility, rightly discerned in the institutions of government, was not also recognised in the institutions of the market, which were understood as a sort of perpetual motion machine for economic growth, which only the ill- advised interventions of governments could disturb or dislocate. Once the simple truths of Adam Smith and the Manchester School were grasped again, and so long as they prevailed in government, the turmoils and terrors of history were bound to be exorcised, and humankind would emerge on to a sunlit plateau of permanent betterment. (p.vii)
Against this, Mr Gray claims that markets are often chaotic. They are swept by waves of irrational panic and optimism. They do not always clear. Nor do they provide everything that is needed for human autonomy. Above all, they take no account by themselves of important externalities. The last paper in this book is taken up with gloomy warnings of ecological collapse in the next century. Mr Gray has no time for the socialist bias of much Green thought; and he is careful to show how much pollution can be, and often is, minimised by the introduction of markets. Yet he does strongly believe that market capitalism has allowed the rich minority of mankind to bring the environment to the verge of disaster, and that the enrichment of the majority by the same means will inevitably carry us forward to something like the apocalypse of St John.
It is in this paper that he comes to advocate a level of government intervention that no libertarian and few present conservatives will allow.
All of this amounts to a substantial attack, and it deserves an equally substantial response. I have not here the space to provide this; but I will try my best to outline what I think is an appropriate response. I will take each of Mr Gray’s points in the order that I have given them above.
First – It is true that many libertarians ignore the long cultural evolution in which – indeed often after which – market institutions have emerged in the West. This is a mistake made repeatedly at least since John Locke published his Second Treatise, and derives finally I suppose from Aristotle, with his talk of a natural law. It is found more or less explicitly in the works of Murray Rothbard, Ayn Rand, Ludwig von Mises, Robert Nozick, and both Friedmans. To act on this mistaken assumption, and introduce markets into societies where they have not previously existed, or existed only with strong limitations, will in the first instance be disappointing.
Even so, while I take his attacks as applying to libertarianism, Mr Gray, it must be recalled to mind and kept there, is addressing himself to what he calls the “new right” – a far broader category of thinkers, where this mistake is by no means universally made, and where it is often discussed and rejected.
Here, I think, is an astonishing lapse on Mr Gray’s part. His attacks apply best – and sometimes only – to a minority within a minority. Yet by continually attacking natural rights libertarianism while referring to the “new right”, he gives the impression that an entire intellectual movement is at fault. It is exactly as if he were to write a biography of Torquemada and call it A History of the Christian Church.
It is plain to me that for the most part Mr Gray – in these papers, at any rate: his recent Guardian articles show a retreat beyond its vaguest limits – is not standing outside the “new right”. Much of what he says could easily have come from Hayek. As such, he is only taking sides in an internal debate; and any reader who may be led to think otherwise is being deceived – not deliberately deceived, I will concede, but deceived nonetheless.
Moreover, while Mr Gray is right to criticise a utopian belief in the benefits of universal marketisation, he goes too far. For all he dismisses John Stuart Mill, he seems here to echo him:
Liberty, as a principle, has no application to any state of things anterior to the time when mankind have become capable of being improved by free and equal discussion.2
It is stupid to suppose that designating St Petersburg an “enterprise zone” is enough to make it into another Victorian Manchester. But it is not stupid to hope for radical market reform. Russia today lacks the institutions and customs that underpin a free market. But, as happened in Japan and many other countries, these institutions can be copied from the West and adapted to local conditions. And, given sufficiently strong government, the mafias can be curbed, and space can be cleared for at least the rudiments of a market to emerge.
After all. morality in its details is a product of circumstances: change the circumstances, and eventually morals will adapt. The Bolsheviks created a New Soviet Man – though he was never quite what Trotsky expected him to be. Sooner or later, their work can be undone. In another of his papers, Mr Gray seems to admit this himself:
Conventional academic wisdom about the market has also gone astray in neglecting the virtues that market systems inculcate or demand in people [my italics]. These encompass not only honesty and diligence but also sensitivity to the needs and preferences of others. In predatory Soviet-style systems, the virtues that are at a premium are the Hobbesian ones, appropriate to his hypothetical state of nature, of force and fraud, coercion and deception. By contrast, the virtues elicited [my italics again] are those of the autonomous person…. (p.80)
Second – Mr Gray is right that libertarians lack any self- contained principle of freedom. The apparently simple One Commandment “Thou shalt not initiate force” raises obvious questions. What is meant by the words “initiate force”? If I reclaim stolen property from someone who has bought it in good faith, am I initiating force, or only responding to it? What am I doing if a drunk shuffles up to me in the street, probably to vomit over my expensive new suit, and I shoot him dead? I could fill page after page with similar questions. In every case, the answers are supplied by the customs and beliefs of the society in which I live.
Yet, this being said, not all such principles are worthless. Even if the meanings of abstract words must be supplied from the norms of our own society, general principles still have their use. Take this one, for example:
According to Hayek, we are by nature collectivist animals, but our survival as civilised beings – and our survival at all in our present numbers – depends on free institutions.3 From this, a general principle can be derived: We are at all times to seek the greatest freedom that is compatible with its own long term survival. This is a deliberately empty principle, so far as it seeks to provide a rule by which to judge the data supplied by other investigations.
In the modern West, there are customary allegiances that appear to satisfy the most basic collectivist longings while keeping the others more or less in check. There are many restrictions in the scope of government here that can safely be made, and that therefore ought to be made. But these are to be made very cautiously, with an eye to not undermining the instinctive allegiance of people to the entire system.
For this reason, demands for radical reconstruction ought usually to be resisted. Many British libertarians talk of disestablishing the Church of England and abolishing the Monarchy and House of Lords. This is to be deplored. Whatever abstract arguments can be raised against these institutions, they are attended by few practical inconveniences, and are among the main elements of a system that is generally accepted as legitimate. Take them away, and the system may be fatally destabilised, and the way be opened to further changes that will be found obviously inconvenient.
In our present circumstances, there is probably a similar requirement – and, I repeat, therefore a justification – for some kind of minimal welfare state.
In other parts of the world, customary allegiances are often far less compatible with free institutions, and account must be taken of this when suggesting improvements.
Here, then, is a general principle that can be made to mean something. It may not be quite the absolute imperatives that we find in the works of Hans Hermann Hoppe et al. But it does, at certain times and in certain places, allow and require the following of a broadly libertarian agenda.
I turn now to Mr Gray’s denial of any hard difference between negative and positive rights. This strikes me to be based more on rhetoric than argument; and it is made chiefly to clear the way for his “enabling welfare state”, which he thinks rightly or wrongly an essential support for human autonomy. But there is a world of difference between his right not to be hit on the head and his right to a free hip replacement. The reciprocal of the first is an obligation that I share with the rest of mankind not to hit him on the head. The reciprocal of the second is my obligation as a taxpayer to hand over money for the National Health Service. Negative rights are balanced by limited prohibitions. Positive rights are essentially unbalanced, involving as they do often unlimited obligations on the part of others. I am saddened that Mr Gray can be so careless, or contemptuous of his readers’ intelligence, as to produce so plainly worthless an argument.
Third – Mr Gray is again right that markets may be inherently faulty. Even granted the most soundly Austrian baking system, I am unable to imagine a world without periodic enthusiasms and crashes. I also agree with him that there seems to be a long term cycle of progress that is beyond the Austrian analysis. I could say in mitigation that no matter what instances of market failure can be found, they are dwarfed by our everyday experience of State failure. We might find that the trade cycle was ineradicable, yet still accept that very free markets were more conducive to happiness that most schemes of intervention so far tried or projected.
But I will not argue this point. I will instead go to Mr Gray’s chief objection to market capitalism: that it may not be compatible with the maintenance of a healthy environment. Human numbers have increased remarkably during this century, and, other things being equal, will continue to increase during the next. Taking a long perspective, we may be rather like yeast cells in a wine vat: we are bound to multiply to the point where we either exhaust our means of support or drown in our own waste.
Against this, Mr Gray himself admits that the rate of population increase is beginning to slow. It is also a fact that the rate of increase in the production of food and other necessities is continuing to accelerate. True, current farming and industrial practices are sometimes harmful to the environment. But current industrial practices are far less harmful than they were even a generation ago, and I see no reason to doubt that further scientific progress will – granted the right political institutions – solve all other problems, both actual and prospective.
Moreover, something that Mr Gray seems to overlook is the colonising of space and the seabed. This former especially opens a vista of indefinite progress, which the growth of population can hinder only by its slowness. Now, I am not conjuring a science fiction utopia for the 21st century – though one might have been possible had there been less waste on armaments and public welfare in our own century. I do not expect that we shall live to see Mars or Venus greened, or interstellar travel. These are for the century after next. We may instead live to see colonies in space perhaps more horrible than the first European colonies in America.
On the example of these earlier emigrations, the first excess populations to be syphoned into space will come from the poor countries. The first viable colonies will be vast orbiting hulls, filled with wage slaves living in conditions of unspeakable squalor. Now and again, some meteor or piece of space junk will crash into one, or the life support system will fail; and it will be common to hear of a hundred thousand or a million deaths. For generations to come, emigration from this planet will be an option only for the very brave or the desperate.
Yet we must look forward to this. It is preferable to some human equivalent of the wine vat; and Mr Gray’s fantasy of “green conservatism”, with its stationary state economy, is neither possible nor desirable. He is welcome to believe that
The project of promoting maximal economic growth is, perhaps, the most vulgar ideal ever put before suffering humankind. (p.127)
But he has assured access to the flush toilets and anaesthetic dentistry that he twice goes out of his way to praise. He can afford a revised scale of preferences, in which more cotton underclothes are less valuable than an afternoon spent playing string quartets. Never mind the conceptual difficulties – if we divide the amount of wealth now existing by 5.5 billion heads, we shall see what a wretchedly poor world we still inhabit. The only chance that the bottom four fifths of humanity have of improvement lies in at least a quadrupling of gross planetary product.
On this point, Mr Gray is flatly wrong. His green conservatism, if ever tried, would be almost as bad as the problem that it is supposed to solve.
So here it is. When Mr Gray argues as a liberal conservative, I tend to agree with him – though he says nothing that has not been said by people like me for generations; and, if the term is to have any meaning at all, people like me must be accepted as belonging to the “new right”. When he says anything different, he says nothing that is not always wrong in fact, and usually silly as well.
And if this is all that can be said against us, I look forward to an unbroken intellectual ascendency.
1. Edmund Burke, Reflections on the Revolution in France (1790), “Everyman” edition, J.M. Dent & Sons Ltd, London, 1910, pp. 74-75.
2. John Stuart Mill, On Liberty (1859), published with other essays in the “Everyman” edition, J.M. Dent and Sons, London, 1972, p. 73 (Chapter II, “Of the Liberty of Thought and Discussion”). See against Mill Thomas Babbington Macaulay, writing 25 years earlier:
Many politicians of our time are in the habit of laying it down as a self-evident proposition, that no people ought to be free till they are fit to use their freedom. The maxim is worthy of the fool in the old story who resolved not to go into the water till he had learnt to swim. If men are to wait for liberty till they become wise and good in slavery, they may indeed wait forever
(Review of Milton’s de Doctrina Christiana Libri Duo Posthumi (1825), in Critical and Historical Essays, “Everyman” edition, J.M. Dent and Sons, London, 1931, Vol. 1, p. 180).
Hayek uses this quotation for the same purpose – Constitution of Liberty, Routledge & Kegan Paul Ltd, London, 1960, pp. 444-45 – though he is unable to say where he found it.
3. F.A. Hayek, “The Three Sources of Human Values”, in Law, Legislation and Liberty, Routledge & Kegan Paul Ltd, London, 1973-73, vol. 3, pp. 153-76.
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