Tag Archives: liberals

Spontaneity and order

 

Hayek

 

Ten years ago, I began a piece in The Economist about Hong Kong with a paragraph that was, in this particular context, intended to be surprising:

FRIEDRICH VON HAYEK and Walter Eucken parted company over the issue of power formation in the private sector. Hayek, a leader of the Austrian school of liberalism, believed that keeping government small was enough to preserve competition. Eucken, who founded the school’s German branch, felt that anyone with excessive power, whether a government or a company, could threaten economic freedom. It is a pity that neither was alive this week to analyse the case of Hong Kong….

 

Eucken (click for credits)

 

Our local readers in Hong Kong quite enjoyed this framing of what they considered their “little” hometown business controversies, since they don’t usually see their city connected to the big debates among Western intellectuals.

I, however, was fascinated by precisely those local controversies, for two reasons:

  1. I consider Hong Kong the freest place in the world (and thus worth studying), and
  2. I have a personal connection to that debate between Hayek and Eucken, which I’ll tell you about at the end of this post.

Liberalism vs Libertarianism

What reminded me of all this was a post the other day by one of my colleagues about the two isms, Liberalism and Libertarianism. He concludes that the difference is basically about the precise role of government and

which approach is likeliest to lead to the most freedom.

So, because I’ve been parsing Liberalism here on The Hannibal Blog for a couple of years now, I thought I’d add a “continental” twist for those of you who are connoisseurs of all things liberal.

Between Freiburg and Vienna

 

Mises (click for credits)

 

For a lot of “Anglo-Saxons”, in my experience, the first surprise is that that there is a continental twist at all. Surprise turns into shock when the twist turns out to be specifically Germanic. Could Germans really have much to say about freedom?

Well, yes, a whole lot. The liberal tradition is long and deep in the German-speaking countries. Obviously it suffered a near-death experience during the Nazi years, but then it came roaring back in the post-war years.

More to the point, a lot of what we now tend to think of as “Anglo-Saxon” ideas actually have an intellectual pedigree that goes back to these “Germanic” (mainly German and Austrian) thinkers.

Ludwig von Mises (above) was the first giant of the so-called “Austrian School”, and in turn influenced the even more gigantic Friedrich von Hayek. Hayek in turn influenced Milton Friedman, who in turn influenced Ronald Reagan and Margaret Thatcher, thus re-branding Austrian Liberalism in the minds of many people as an “Anglo-Saxon” thing.

 

Rüstow

 

Walter Eucken, on the other hand, founded the so-called “Freiburg School” of Liberalism (after the university town where they hung out), which included liberal thinkers such as Alexander Rüstow (above) and Wilhelm Röpke (below).

 

Roepke

 

How spontaneous is order?

The first and most important thing to understand about all these thinkers is that they were friends. They liked each other’s company and liked debating one another. They viewed themselves not on opposing sides of anything, but on the same side: the side of individual freedom (which is what all classical Liberals agree on).

The subtlety that kept them busy (and I deliberately oversimplify) had to do with order. The Latin for order is Ordo, so the Freiburg School eventually even called themselves Ordoliberals.

Order, as opposed to anarchy, is necessary for individuals to be free. The question, however, is whether or not order comes about spontaneously.

Option 1: Yes

If the answer is Yes, as the “Austrians” basically believed, then the conclusion has to be that we simply need to keep government out of the equation entirely.

The “market” (and this could apply to more than material things — ie, ideas, culture, etc) will then “order” itself spontaneously, though competition. The prerequisite is merely the rule of law.

Option 2: Jein

The Ordoliberals did not counter that the answer is No. Instead, I would call their answer Jein (a contraction of Ja and Nein in German). Yes, markets can spontaneously create order. But that order is not always stable. Worse, that order could be of a sort that robs individuals of liberty.

What they had in mind were cartels, tycoons, cabals, and anybody else who amassed an unhealthy amount of power.

So whereas the “Austrians” worried almost exclusively about excessive government power, the Ordoliberals worried about all excessive power, whether in the private or public sector.

This led the Ordoliberals to the conclusion that government must, yes, stay limited, but must also supplement the “spontaneous” ordering of markets with “corrective” ordering. Government had to crack down hard on cartels and monopolies, for example.

My personal interest

I mentioned a personal connection to the debate. Well, I wrote my Master’s thesis at the London School of Economics about it (or rather, about an obscure aspect of it). My dad had once written his PhD thesis about another obscure aspect of it. And that was probably because his uncle and godfather was somebody by the name of Ludwig Erhard (“Uncle Lulu“). Here they are in the sixties, Lulu on the left, dad on the right:

And if Hayek influenced Ronald Reagan and Margaret Thatcher, and thus “Anglo-Saxon” policy, the Ordoliberals shaped Ludwig Erhard and thus post-war West German policy, for Uncle Lulu was West Germany’s first economics minister and then its second chancellor.

Postscript: Liberal v Libertarian (again)

So back to those two isms.

In essence, I think that Libertarians trace their evolution back to the Austrians featured here, and Liberals to the Ordoliberals.

However, those Austrian and Ordo-Liberals themselves, if we were able to bring them here today, would be puzzled by the debate. They would abhor some of the intellectual excesses committed in both names, and remind us that they were originally almost indistinguishable.

Intelligence and liberalism

Probably Republican

The Hannibal Blog recently introduced you to Satoshi Kanazawa, a controversial evolutionary psychologist.

A willingness to be controversial, when paired with actual research and intelligence, is a trait The Hannibal Blog applauds. Even so, you guys appropriately rang the alarm bells about some of Kanazawa’s more out-there views in the comments under my post.

That said, those views were not the ones that I found interesting (or had even been aware of). So allow me to re-introduce you to some of Kanazawa’s thinking.

1) The Savanna Principle

Evolutionary psychology starts with the premise that our brain, like our liver or eye or gonads, has evolved. This immediately leads to interesting insights, such as The Savanna Principle, a term that Kanazawa coined.

It states that we (Homo sapiens sapiens), having spent most of our evolutionary time in the African savanna, have adapted to its circumstances. We have not had much time (in terms of generations) to adapt to modern life. Therefore

the human brain has difficulty comprehending and dealing with entities and situations that did not exist in the ancestral environment.

(The word difficulty is important: Dealing with modern circumstances is not impossible, merely difficult.)

Thus, humans will see a banana as yellow (= recognizably edible) under all conditions except in a parking lot at night, because sodium vapor light did not exist in the savanna.

Let’s take another easy example. I recently railed against driving while texting or talking on the phone (the former is worse than drunk driving, the latter is as bad). Why are both activities so dangerous (whether or not you use “hands-free” devices)? Well,because

carrying on a conversation with someone who is not present in front of you is evolutionarily novel. Our ancestors never carried on a conversation with anyone who is not present in front of them or whom they could not see during the conversation. We have had the telephone (which allows us to have such conversations) for more than a century now, but it is still evolutionarily novel. Our brain has not adapted to the telephone in the last century. So it is possible that telephone conversations per se, not necessarily cell-phone conversations, are cognitively taxing and distracting because they are evolutionarily novel.

Everyone (legislatures and publics alike) assumed that what was causing the accidents was the manual and mechanical handling of the device, not the conversations per se. After all, drivers have conversations with fellow passengers all the time, with seemingly no effect on safety. [But] drivers who use hands-free devices are just as likely to cause road accidents as those who use hand-held devices.

2) Relevance to intelligence

More recently, Kanazawa has been thinking about how intelligence might have evolved in the Savanna, given that it would have been mostly useless there.

By intelligence he means general intelligence, as opposed to any set of specific adaptations to address specific threats in the Savanna (such as the specific ability to recognize a cheater in a social setting). Put differently, how and why would Homo sapiens have evolved to deal with any novel threat?

Well, it must have evolved since we left the Savanna. Our departure meant that we started encountering one (evolutionarily) novel situation after another, and those of our ancestors who happened, by mutational chance, to be better equipped to think about these new situations would have had a reproductive edge.

But intelligence can be misunderstood. As Kanazawa says:

more intelligent individuals are better than less intelligent individuals at solving problems only if they are evolutionarily novel. More intelligent individuals are not better than less intelligent individuals at solving evolutionarily familiar problems, such as those in the domains of mating, parenting, interpersonal relationships, and wayfinding (finding your way home in a forest), unless the solution involves evolutionarily novel entities. For example, more intelligent individuals are no better than less intelligent individuals at finding and keeping mates, but they may be better at using computer dating devices. More intelligent individuals are no better at finding their way home in a forest, but they may be better at using a map or a satellite navigation device.

3) Relevance to politics

The controversy starts right about now.

One by-product of this recently evolved general intelligence, according to Kanazawa, is an ability to empathize with people to whom we are not genetically related.

In the Savanna we only cared about kith and kin, because we hardly knew anybody else. (We lived in groups of up to about 150 individuals, the so-called Dunbar number.) Modern cities or countries did not exist.

But they exist today, as evolutionary novelties. Does general intelligence help us to deal with the situation?

Yes, says Kanazawa, by making us “liberal”. He uses not the correct and traditional definition but the modern American definition of liberalism

as the genuine concern for the welfare of genetically unrelated others and the willingness to contribute larger proportions of private resources for the welfare of such others. In the modern political and economic context, this willingness usually translates into paying higher proportions of individual incomes in taxes toward the government and its social welfare programs. Liberals usually support such social welfare programs and higher taxes to finance them, and conservatives usually oppose them.

And indeed, he has found a certain correlation between intelligence and liberalism:

And by the way, Kanazawa considers himself conservative.

So, as he says in a follow-up post, this is not to imply that liberals are “smart” and conservatives “dumb” in the conventional sense.

In fact, it may well be that liberals lack, and conservatives have, “common sense” — if by common sense we mean precisely that more pristine and specific intelligence that allowed our ancestors to survive and reproduce in the Savanna.

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The minds of liberals and conservatives

Jonathan Haidt

Jonathan Haidt

The biggest mistake in psychology is to think that the mind at birth is a blank slate. Instead, “the first draft” has already been written, and will now get revised by experience.

So says Jonathan Haidt, a psychologist whose book I reviewed here, in this TED talk. (I can’t embed TED videos, unfortunately.)

In particular, whether you’re liberal or conservative probably comes down to five aspects of your first draft, he says: How much you worry about/value:

  1. Harm/care
  2. Fairness/reciprocity
  3. the Ingroup/loyalty
  4. Authority/respect
  5. Purity/sanctity

In all cultures, liberals tend to value care and fairness most, but largely reject the ingroup, authority and purity as values. Conservatives tend to value them all. Thought-provoking.

Other reactions to the talk here and here.


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