Law, Legislation and Liberty

"Religious prophets and ethical philosophers have of course at all times been mostly reactionaries, defending the old against the new principles. Indeed, in most parts of the world the development of an open market economy has long been prevented by those very morals preached by prophets and philosophers, even before governmental measures did the same. We must admit that modern civilization has become largely possible by the disregard of the injunctions of those indignant moralists. As has been well said by the French historian Jean Baechler, ‘the expansion of capitalism owes its origins and raison d’être to political anarchy’."

"I can already hear our modern intellectuals hurling against such an emphasis on tradition their deadly thunderbolt of ‘conservative thinking’. But to me there can be no doubt that it was favourable moral traditions which made particular groups strong rather than intellectual design that made the progress of the past possible and will do so also in the future. To confine evolution to what we can foresee would be to stop progress; and it is due to the favourable framework which is provided by a free market but which I cannot further describe here that the new which is better has a chance to emerge."

"Law, Legislation and Liberty opened with the avowal that his political ideals had not attracted the support they merited, and that he had failed to bring home that 'the predominant model of liberal democratic institutions' in the Western world, 'necessarily leads to a gradual transformation of the spontaneous order of a free society into a totalitarian system'. To avert this fatal propensity, which Hayek remarked that Schmitt had in his time understood — but also encouraged — more than any other observer, three truths urgently needed to be understood. The first was the fundamental difference between a spontaneous order and a purposive organization, or what Hayek now termed a cosmos and a taxis […]. The rule of law could be preserved only so long as the structure of government reflected a principled separation of the two, according an absolute priority to the maintenance of the first, as the condition of a market economy in a free society, and confining the second to strictly delimited, subordinate functions in the public interest. All current democracies confused these requirements, […] with the intrusion of macro-economic steering and the erection of a welfare state, in the name of an imaginary 'social justice' - a notion without meaning. For the spontaneous order of the market not only precludes equality, it necessarily ignores desert: success within it is undeniably often a mere matter of chance. But his theory still faced an awkward difficulty in the apparent institutional outcome of the spontaneous social mechanisms it celebrated. For was not the steady erosion of the division between taxis and cosmos, with the seemingly inexorable growth of the welfare state, itself pre-eminently an evolutionary process? To roll it back required — according to Hayek's new prescriptions — drastic redesigning of the structure of the state. Indeed, what he now proposed was nothing less than a dismantling of every known legislature into two novel bodies with different competences and disparate electorates, to correspond to the two ontological kinds of order — the more powerful chamber, guardian of the rule of law as such, striking anyone under the age of forty-five off the voting-roll. This, as even sympathizers could not fail to notice, was a violent attack of the very constructivism his theory had set out to purge. Hayek was unmoved. Such was the price of preserving nomos, or the law of liberty, from the logic of popular sovereignty. Assemblies had to be stripped of their powers of general meddling, in order to secure the limited government — based on the rigour of law, not the licence of consent — which was the only guarantee of freedom. The correct formula, Hayek explained, was demarchy without democracy."

"Law, Legislation, and Liberty shows Hayek at his most bold and pioneering. Volume I brilliantly explains the differences between unplanned orders (such as languages and market economies) and planned organizations (such as business firms and centrally planned economies). Volume II explains why the popular idea of “social justice” is meaningless. Volume III contains Hayek’s most ambitious attempt to describe in detail what the legal and political structure of his ideal society would look like. The greatest contribution of Law, Legislation, and Liberty, however, is Hayek’s explanation of the fundamental difference between law and legislation. Influenced by the Italian legal scholar Bruno Leoni, Hayek argued that law is that set of rules that emerges “spontaneously,” unplanned and undesigned. Law forms out of the countless interactions of ordinary people as they go about their daily lives. Legislation, in contrast, is a set of rules and commands that government consciously designs and imposes. Hayek believed that every good society must use a combination of law and legislation, but that much mischief is caused when the two are confused."

"It is not merely the outside critic who has difficulties with Hayek's rule-bound Evolutionism. Hayek has difficulty himself. If there is an inbred wisdom, not apparent to the naked eye, in the evolution of common law or common custom, why deny this hidden wisdom to more interventionist or authoritarian structures? After all, institutions such as rent control, price control, a large nationalised sector, and heavy progressive taxation have existed in many countries for generations and have often evolved gradually. Might they not contain their own wisdom, not obvious to Hayek when writing as an economist? And will not, say, the abolition of rent control in Britain—let alone the reproduction of capitalism, or free elections, in the Soviet Union—set in train all sorts of events not foreseeable by the simple-minded democrat or free-market economist who looks only at immediate consequences?"

"The biggest weakness of Hayek's proposals for a Legislative Assembly is not the method of selection but the lack of even a vague picture of how it would operate in practice in relation to the Governmental Assembly. He is explicit that the Budget must be considered by the latter body. But the majority party in that assembly would not have unlimited freedom to make any budgetary provisions it liked, or the whole point of the arrangement would go. Would it set rates within a tax structure designed by the legislators? Where would the boundary be? Would there be any limits to tax progression, or for that matter any guarantees for social security beneficiaries? Here we are merely told that the principles of public finance would have to be rethought."

"I think that there are two possible solutions. One is to say that Hayek’s criticisms of constructed orders and his evolutionary account of the development of ethics were on two different levels. Hayek himself was a type of rule utilitarian, and his criticisms of constructed orders had to do with the bad consequences he thought they entailed. On the other hand, his evolutionary writings were a positive account of the origins, persistence, and functions of a system of ethics and of certain specific ethical norms. This also may hold the key for explaining his model constitution proposal. Here we must distinguish between rule proposal or design, and rule selection. Anyone, including Hayek, is free to propose new designs for rules. Rule selection, though, takes place through an evolutionary process: new rules and practices are tried out, and they succeed or fail. (It must be admitted, though, that the model constitution goes considerably beyond the sort of “piece-meal” proposals for change that Hayek typically viewed as acceptable. Another solution for this particular problem is to take him at his word, that it is only a model, a kind of thought experiment.)"

"Law, Legislation and Liberty was written and published during a different period from The Constitution of Liberty. The earlier work was a product of the late 1950s—a generally optimistic and socially cohesive time when Hayek himself was in his late fifties, at the University of Chicago. Law, Legislation and Liberty, on the other hand, was a product of the 1960s and 1970s, a far more turbulent time, as he became an old man, was somewhat intellectually isolated in Freiburg and Salzburg, and experienced depression. That the later work has a different feel from the former is hardly to be unexpected. The relationship between the two works might be considered to be something like that between Plato’s Republic, a product of his prime, and Plato’s Laws, a product of his old age."

"Hayek’s attempt to fashion a regime in which the freedoms he cherished would be invulnerable to political challenge led him to some curious proposals. In The Political Order of a Free People (1979), the third volume of his last major work, Law, Legislation and Liberty, he outlined a scheme for a bicameral legislature in which the upper chamber is composed only of people elected at the age of 45 for a 15-year term by an electorate also consisting only of 45-year-olds. When they reached 60, members of the upper house would be retired and given a lifelong sinecure. Hayek liked to ridicule the idea that institutions could be designed on the basis of abstract models – a view he criticised as embodying a philosophy of “constructivist rationalism”. Yet his scheme for an ultra-liberal constitution was a prototypical version of the philosophy he had attacked."

"Von Hayek’s insistence that representative democracy must be restrained so that democracy can be protected from its own worst tendencies arguably placed much too much faith in the spontaneous freedoms allegedly generated by markets. It supposed rather too readily that constitutional mechanisms could be relied upon to have self-restraining effects upon the power and scope of government. There is as well the suspicion that ‘demarchy’ would in practice quickly degenerate into a species of state authoritarianism. Von Hayek was fond of proposing (see ibid., p. 113) a bicameral system of government regulated principally by an assembly charged with the task of defining and protecting the constitutional framework. The assembly members would comprise men and women aged between 45 and 60, elected as representatives for a fifteen-year term by voters who cast their ballots for a representative of their choice only once in their lives, in the calendar year in which they reached the age of 45. Quite aside from numerous technical objections to the whole proposal for an assembly that resembled a senate of the wise, Von Hayek never made clear exactly how public support could freely be won for constitutional rule by an elite based on such a restricted franchise. These and other criticisms of his attack on democracy have been well developed by others elsewhere. Here, the fundamental objection to von Hayek’s reasoning is quite different, and more elementary. It is an empirical objection: that von Hayek failed to spot the growth of monitory democracy, with its scores of new non-market and extra-constitutional mechanisms designed to monitor and make publicly accountable exercises of power, not only in the field of domestic and cross-border government but also in the local, regional and global fields of markets and other civil society institutions."

"Hayek's political philosophy either invokes a number of different, and incompatible, moral theories to defend different claims, or lacks any normative moral theory at all. [...] Hayek presents three kinds of argument to defend his liberal social order and the conception of justice he sees at its heart. The first is a contractarian argument which invokes Kantian considerations to deny that patterning principles of social justice can be morally justified. The second is a conservative argument which not only points to the value of established traditions but also repudiates the claim that reason can present complete justifications for the rules governing any social order. The liberal order is preferred as that order which makes the fewest demands upon individual reason, for its principles of justice aim primarily at maintaining the abstract order of rules rather than at the rational reconstruction of society according to principles of distributive justice. The third is a utilitarian argument drawing attention to the beneficial consequences of a stable regime of liberal justice: progress and material prosperity. While each of these arguments appears in Hayek's work, none, as we have seen, can clearly be held to be fundamental."

"Hayek himself, then, was a partisan of the milder version of Hayekianism. This version is not so much a prescription as an attitude. Respect tradition. Reject utopianism. Plan for mistakes rather than for perfection. If reform is needed, look for paths that follow the terrain of custom, if possible. If someone promises to remake society on rational or supernatural or theological principles, run in the opposite direction. In sum: Move ahead, but be careful. Good advice. But not advice, particularly, against gay marriage. Remember Hayek's admonition against dogmatic conservatism. In a shifting current, holding your course can be just as dangerous as oversteering. Conservatives, in their panic to stop same-sex marriage, jeopardize marriage's universality and ultimately its legitimacy. They are taking risks, and big ones, and unnecessary ones. The liberal tradition and the Declaration of Independence are not currents you want to set marriage against."