friedrich hayek

Ignorance at the New York Times: Kate Zernike and the “Rule of Law”

by Hans Bader on October 8, 2010 · 1 comment

in Legal

The New York Times doesn’t know what the “rule of law” means.  In a story on the Tea Parties, reporter Kate Zernike claims that the “rule of law” is an “unwritten code” against government interference with “personal ends and desires” that has been adopted by the Tea Partiers.  She falsely attributed that strange definition to a book that she called a “once-obscure” text found on “dusty bookshelves” — the best-seller The Road to Serfdom by Friedrich Hayek.  Hayek was a famous free-market economist who received the Nobel Prize in 1974 and the Presidential Medal of Freedom in 1991.  Hayek has been approvingly cited as a groundbreaking thinker by even liberal economists, like Harvard’s Lawrence Summers, an adviser to Presidents Obama and Clinton.  Summers has said that Hayek’s legacy is “the single most important thing to learn from an economics course today.”  But to liberal reporter Zernike, Nobel Prize winner Hayek is a strange right-wing wacko that no one ever heard of before he was discovered by the Tea Parties.

The Times also didn’t know what an S Corporation is, as it was forced to reveal in a correction to a recent article slanted in favor of tax increases.

Being liberal is a virtual litmus test for working at the New York Times (even its house “conservative,” David Brooks, endorsed Obama in 2008).  Being well-read is not, nor is having a basic grasp of the economy.  Those things would just get in the way of pushing a know-nothing Manhattan-liberal agenda, like claiming that increases in government spending are good for the economy (even though increases in spending typically wipe out jobs in the long run, and often do so even in the short run).

As the Economist notes, “the rule of law, as Hayek understands it, does not, as Ms Zernike writes, prohibit government from interfering with the pursuit of personal ends and desires,” but rather embodies “ideals of impartiality, generality, and equality before the law.”  Nor is it supposed to be an “unwritten” code: indeed, “the rule of law” according “to Hayek ‘means that government in all its actions is bound by rules fixed and announced beforehand.’ Typically, these rules, once fixed, are written down and then published. . . The idea is that politically-determined rules need to be relatively fixed and publicly known in order to create a stable and certain framework in which individual planning and complex social coordination can flourish.”

CEI in Europe: Travelblog 6–Berlin, Germany

by Nicole Ciandella on September 20, 2010

in CEI Projects, Coalitions & Outreach, International

One of the teachers at the recently-completed Language of Liberty camps was fond of telling students a certain joke: “Do you know what the most frightening sentence in the English language is? I’m from the government and I’m here to help.”

The students in Portugal and Poland didn’t laugh. They didn’t really see the humor in government trying to help people.

We’re in Berlin now. The Sulejow Language of Liberty camp has ended, and we’ve stopped in Berlin for one night before returning home to D.C. The ghost of the wall that once separated this city is eerily memorialized in the fragments still here. The East Side Gallery is a kaleidoscope of political art and irreverent graffiti. The Brandenburg Gate stands solemn, alone, like a doorway to a room that no longer exists.

We have lunch with the director of Berlin think tank. He asks us if we’ve noticed anything interesting about the police in Berlin. “Their priority is de-escalation,” he explains. “That’s what they’re trained for — de-escalating situations before they become violent.” He says policemen try to avoid making arrests whenever possible, even when they’re insulted or threatened. “More or less, they really are just there to help,” he says. “It’s a bit different than in America, no?”

If the American government is a paternal government — a strict, protective disciplinarian — then most European governments are decidedly maternal. They provide care. They nurture. They purport to do for the people what the people cannot or will not do for themselves.

Cities across the European continent are scarred by the vestiges of fascist and communist regimes. There is a real and recent memory here of what it means to be truly frightened of one’s government. There is also a collective memory of revolution. It’s a memory made manifest in monuments, museums, and cemeteries. It’s permanently sewn into the fabric of political language. American Tea Partiers may have taken their name from revolutionaries, but in Europe, revolution is more than a story of national origin. It’s something many of these cities experienced in the 20th century. The memories of oppression and revolution, so patent in the urban landscape of Berlin and other cities, are a constant reminder of what happens when state power ceases to be a tool of the people.

Europe’s history of tyranny is what sets the tone for the current citizen-government relationship here. Governments are careful not to dictate or demand. Instead, they guide; they de-escalate. And with the experience of oppressive paternalism now largely behind them, the new European generation gladly accepts democratic maternalism. The students we met at the Language of Liberty camps think that their governments are flawed, but essentially good. They don’t really understand the anti-nanny-state angst of Americans. Most of these students don’t want to scale back state power; they just want to fix state power. They want to help their governments to better help their people.

This is why there’s a disconnect between American and European political discourse — why the classical liberal movement is floundering in the home countries of Friedrich Hayek and Frederic Bastiat. European governments don’t wear heavy boots anymore; they wear kid gloves. When the people and the state are in tandem — finally happy with each other after an unhappy past — the people are overwhelmingly and dangerously tempted to allow the state to suffocate them with maternal care.

Hayek vs. Keynes Rap Battle–Fear the Boom and Bust

by Ryan Lynch on January 25, 2010 · 1 comment

in Culture, Odds & Ends, Zeitgeist

Sit back for a moment and read the title of this blog post again. Let it sink in.

A new video just released by Econstories.tv, a project of The Mercatus Center, explores the basis of both Hayek and Keynes economic theories in classic west coast rap style.  Co-written by Russ Roberts, also host of the EconTalk podcast, this video is attempting something difficult: Finding  ways to expose a new audience to the philosophy of free markets.

Hayek on Freedom

by Ryan Young on January 4, 2010

in Odds & Ends, Personal Liberty, Sanctimony, Zeitgeist

Think for a minute about how progress is made. It doesn’t follow a constant, linear path. It is unpredictable. It comes in violent fits and starts. It happens at the whim and fancy of genius.

Everyday life is much the same. Life is what you make of it. You have to be free to find what’s best for you. That means making wrong choices sometimes. It means not just trial, but error. Or, as Hayek put it:

“If we knew how freedom would be used, the case for it would largely disappear… It is therefore no argument against individual freedom that it is frequently abused.”

-F.A. Hayek, The Constitution of Liberty, p. 31.

The Irony of the Liberty Bill

by Evan Banks on June 21, 2009 · 2 comments

in Culture, Politics as Usual, Zeitgeist

H.R. 2854, a proposed bill making its way through committees, would require the Treasury Secretary to give the greenback a makeover. The bill aims to replace the Great Seal of the United States (which Franklin Delano Roosevelt incorporated in 1935) on the reverse of the dollar with excerpts from the U.S. Constitution including the preamble, a list of Articles, and a list of Amendments in the founding document. The bill, cited as the “Liberty Bill Act,” states that Congress believes that “many Americans are unaware of the provisions of the Constitution of the United States” and that the proposed new Federal Reserve notes would “remind the American people of the historical importance of the Constitution and its impact on their lives” and “remind Americans of the blessings of liberty. . .[and] of the framework of the United States government.”

Granted, I don’t consider myself an average citizen, but I personally carry a copy of the Constitution and the Bill of Rights with me to remind myself of the limits our forefathers placed on governmental power — limits which have secured to our nation the trappings of liberty and prosperity throughout the years. Undoubtedly it would be a good thing to see more people knowledgeable and well-versed in the basic principles of the founding documents of our country. There is a great and weighty irony, however, in printing portions of this document on Federal Reserve Notes, an institution which, according to some experts, is nowhere to be found in the Constitution.

I am reminded of George Orwell’s Animal Farm when I hear of proposed bills such as this one. You’ll perhaps remember the Seven Commandments which were written on the barn wall by Napoleon and Co. “in great white letters that could be read thirty yards away,” which constituted “an unalterable law by which all the animals on Animal Farm must live for ever after”:

1. Whatever goes upon two legs is an enemy.

2. Whatever goes upon four legs, or has wings, is a friend.

3. No animal shall wear clothes.

4. No animal shall sleep in a bed.

5. No animal shall drink alcohol.

6. No animal shall kill any other animal.

7. All animals are equal.

As anyone who has read the story knows, in the following pages the pigs go on to pervert, circumscribe, and later rescind every Commandment save one in the aforementioned list, concluding infamously and chillingly with the line “All animals are equal, but some animals are more equal than others.” Perhaps what is most troubling about this downward spiral, however, are the other animals’ reactions toward the pigs’ alterations, or rather their lackadaisical compliance to the pigs’ demands. Time and time again we are told that “somehow or another” the animals had forgotten that the pigs’ alterations to the Commandments had been there “all along,” or that it “did not seem strange” as the treacherous pigs increasingly take on the physical and amoral qualities of their former human masters.

Public display of the Commandments did nothing to halt or slow their eventual corruption. In fact, by turning them into a mantra (the sheep were especially fond of commandments one and two, but in the end fell to the pigs’ twisted influence all the same), Napoleon and Squealer were able to warp their meaning to the point at which the Commandments were used against the impressionable animals. Putting the Commandments on stage served as an accelerant to this end; the crafty swine knew that under constant public scrutiny what was once absolute would become slippery, then give way altogether and fall into a morass of meaningless impotence. Orwell himself cautioned in Politics and the English Language that “. . .if thought corrupts language, language can also corrupt thought.”

Too often in politics the meaning of words become liquid campaign slogans, transformed by gilded tongues into passionate promises and adamant assertions, or they are primed and charged with so many attached packets of meaning that the original meaning of the word stands as a hollow husk of what it once signified. By this process words become labels, and labels in turn become a little less than zeitgeist on the backs of transfixed ideologues.

As Friedrich Hayek put it in The Road to Serfdom:

The most effective way of making people accept the validity of the values they are to serve is to persuade them that they are really the same as those which they. . .have always held, but which were not properly understood or recognized before. And the most efficient technique to this end is to use the old words but change their meaning. Few traits of totalitarian regimes are at the same time so confusing to the superficial observer and yet so characteristic of the whole intellectual climate as the complete perversion of language, the change of meaning of the words by which the ideals of the new regimes are expressed.

Indeed, we must proceed with caution on this ground, or not at all. Rubber-stamping our money with the likeness of our most cherished pact between citizenry and government may make one set of papers more important, but it could render another set impotent as well.

On the other hoof, Congress has a point, I think, in stating that many Americans are unaware of the meaning and importance of the Constitution. I’m just not sure that the back of an inflated, central-bank issued fiat currency is the appropriate medium for learning about limited government.

What do you think? Would this bill profane one of the greatest foundations of our liberty by opening it up to the liquefying subversion of linguistic politics? Or will it actually serve to educate and remind people of the limits of government at a time when limited government is so badly needed?

That G20 Communique

by Iain Murray on April 3, 2009 · 1 comment

in International, Regulation, Trade

Yesterday’s communiqué from the leaders of the G20 – a motley collection of democracies and dictatorships – has some good points, but in general it represents a new version of what economist Friedrich Hayek called “the fatal conceit.” It believes that government has all the answers, and demonstrates that the world’s leading governments recognize few boundaries. As such, not only does the communiqué promise far more than it can deliver – something the voters in G20 democracies should remember – but it may also impede global economic recovery.

The communiqué holds that, “We start from the belief that prosperity is indivisible; that growth, to be sustained, has to be shared” and to “do whatever is necessary.” In clause after clause, this pro-government rather than pro-prosperity declaration embraces new burdens on a limping financial sector in the form of expanded global regulation, and effectively requires that all look toward government before acting in the future. At no point does the communiqué recognize that government action can and does distort market action to the point of significant harm.

The only “growth” being sustained in today’s political environment – and further embraced here – is the open-ended stimulus culture that has already led to an orgy of “sharing” of citizens’ wealth; in a world increasingly at ease with the word “trillion,” we are not suffering from a lack of sharing. The “unprecedented fiscal expansion” is not, as British Prime Minister Gordon Brown said, an injection of new money (except for some sales of gold reserves) but mostly a redistribution of existing taxpayer money to politically-favored recipients.

An effective communiqué would have acknowledged that wealth is not automatic, that it must be created before it can grow and expand – or be shared. Individuals acting together in voluntary enterprise form the foundation of wealth creation and job growth, but that is nowhere articulated here. Leadership would require the G20 representatives to explain precisely how they plan to unravel tax and regulatory barriers to the creation of new wealth, infrastructure, jobs and new financial innovations. Instead, the document stands as yet another open-ended promise for redistribution of a shrinking pie, and aggressive new political dominance of economic life.

This is not to say that the communiqué is wholly bad. Even as they seek to increase the reach of government by a massive expansion of the International Monetary Fund (by its own figures, the IMF budget is now greater than the GDP of all but 16 countries), the G20 leaders had no choice but to recognize the harmful effects of protectionism. The sections lauding free trade are welcome, and stand as a rebuke to Congressional leaders who have introduced protectionist language in recent bills. If there is one glimmer of hope in the G20 communiqué, it is that the vitality of trade may counteract the dead hand of government control.