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Hayekian Coercion

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08/07/2020

The political theorist Douglas W. Rae, who has taught at Yale University for decades, likes Hayek’s account of freedom but wants to expand what counts as coercion. By doing so, he hopes to be able to extend the amount of permissible redistribution from what Hayek allows.

In a lecture to his class at Yale, Rae says that he likes the definition of freedom that Hayek gives even though it is not as complicated as that given by most philosophers. Rae finds Hayek’s definition pragmatically useful. According to Hayek, you are free if you live in a society with fixed general rules that are known in advance to the members of society. These general rules let you plan what you are going to do. Hayek contrasts this sort of society with one in which you can be commanded to do something. Here, you cannot plan but are dependent on the arbitrary will of someone else.

Hayek of course applies this point to the economy, and this is what Rae likes about it. In a free market, no one plans the whole economy. A centrally planned economy depends on the limited knowledge of the planners. No matter how smart they are, Rae says, the immense expansion of information means that they can know only a minute amount of the total knowledge available. The price system in a free market enables people to take full advantage of their dispersed and local knowledge. (I’m not going to get into the issue of whether this is the best way to characterize the free market. It is, at any rate, accurate about Hayek’s view of the market.) Because of this, I benefit by your freedom, and you benefit by mine, since in a free economy, we can both produce goods and services for the market.

Hayek’s definition of freedom has an important consequence. If you are free if and only if no one can subject you to commands not based on rules known in advance, then some obstacles that you face to doing what you want do not violate your freedom. Obstacles imposed by nature do not do so. In a well-known passage of The Constitution of Liberty, Hayek says:

In this sense "freedom" refers solely to a relation of men to other men, and the only infringement of it is coercion by men. This means, in particular, that the range of physical possibilities from which a person can choose at a given moment has no direct relevance to freedom. The rock climber on a difficult pitch who sees only one way out to save his life is unquestionably free, though we would hardly say he has any choice. Also, most people will still have enough feeling for the original meaning of the word "free" to see that if the same climber were to fall into a crevasse and were unable to get out of it, he could only be figuratively called "unfree," and that to speak of him as being "deprived of liberty" or "held captive" is to use these terms in a sense different from that in which they apply to social relations.

Here is where Rae starts to edge away from Hayek. According to Rae, freedom isn’t worth anything to the climber stuck in the crevasse. Unless he gets out, he will die, and the fact that he isn’t in the crevasse because of someone’s command makes his predicament no easier to bear. Rae offers another example of the same sort. A diabetic who cannot get access to insulin will die, and here again the fact that his illness is a natural phenomenon does not help him.

Rae uses these examples to support a policy of redistribution. The point of Hayekian freedom, he says, is that we all benefit from the local knowledge of people in producing goods and services for the market. But you need a certain amount of resources and freedom of movement in order to participate in the market. The climber in the crevasse is not only in danger of losing his life. While he is in the crevasse, he isn’t part of the market.

Rae concludes from this that to get the advantages of Hayekian freedom, everybody should be guaranteed a minimum amount of resources. People should get enough to enable them to join the productive economy. Hayek might well endorse this proposal, so long as a general law prescribed in advance told people how much they would be taxed. Under this proposal, you wouldn’t get to spend all your income the way your like, but this is consistent with Hayekian freedom. Both Mises and Rothbard criticize Hayek, to my mind effectively, for allowing such redistribution.

But it’s difficult to see how a general law mandating redistribution could be of much help to the mountain climber. It is one thing to establish a baseline in resources for everyone. It is another thing altogether to favor intervention whenever a natural obstacle incapacitates someone. Is someone eligible for redistribution whenever natural misfortunate strikes? Given how unpredictable nature is, how could a law to deal with such situations meet Hayek’s standard of generality?

Rae doesn’t consider this problem, but instead falls into outright fallacy. Suppose he is right that the mountain climber in the crevasse does not gain anything from his Hayekian freedom. Rae wrongly concludes that the climber isn’t free. But this does not follow. Your freedom and the power to do things with your freedom are very different matters. That point is a principal theme of Hayek’s most famous book, The Road to Serfdom.

Rae takes the fallacy one step further. He says that people on the way to a picnic who pass by the mountain climber in the crevasse, ignoring his pleas for help, are coercing the climber. Similarly, someone who withholds insulin from a diabetic is also engaged in coercion. Unless there are special circumstances, this isn’t correct. If there are no general laws requiring people to assist others, or contractual arrangements by which you have agreed to do so, neither the mountain climber nor the diabetic is being coerced. Their Hayekian freedom remains intact. (I am grateful to Professor Ying Tang of the Economics Department of Shenzhen University, for calling this video to my attention and for helpful discussion.)

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Contact David Gordon

David Gordon is Senior Fellow at the Mises Institute, and editor of The Mises Review.

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