Category: Right politics

August 19th, 2018 by geoffhodgson1946

More on the Seven Dimensions of Liberalism

 

Geoffrey M. Hodgson

 

The common core of all varieties of liberalism is the stress on individual liberty and universal rights, including the rights to private property and to freedom of expression. These universal rights and liberties require equality under the law, under a competent legal system that protects rights and pursues justice.

In a previous blog I laid out Seven Dimensions of Liberalism. The present blog extends that analysis by considering different varieties of liberalism within this seven-dimensional space. I contrast what (in forensic mood) might be described as neoliberalism with what I call liberal solidarity.

Classical liberalism

There are several possible names come to mind as possible labels for the highly varied constituent territories of liberalism. Terms such as classical liberalism, new liberalism, social liberalism, neoliberalism and libertarianism should be considered. But all these labels have their problems.

Adam Smith

Consider classical liberalism. This is typically applied to foundational liberal thought from John Locke, through Adam Smith and Jeremy Bentham to John Stuart Mill. But there are profound divisions within classical liberalism.

Thomas Paine’s pursuit of measures to reduce inequality is unmatched by his liberal contemporaries.

Adam Smith’s emphasis on the importance of “moral sentiments” and justice contrasts greatly with the reductionist-utilitarian approaches developed by Hume and Bentham and adopted (albeit with reservations) by Mill.

Apart from the emphasis on individual rights including private property, the classical liberals agreed on the need for a small state. But they lived in a period when the state and its tax levels were much smaller than they became in the twentieth century.

We cannot automatically assumed that they would have taken the same small-state view in the present context, especially if they were responsive to practical experiment and historical experience.

Consequently, classical liberalism does not denote one distinctive type or phase of liberalism. The original Liberalism from the seventeenth to the mid-nineteenth century contained widely diverging variants.

New liberalism and other labels

A major turn in liberal thought was foreshadowed by Mill and developed in the later decades of the nineteenth century and the early twentieth century by Thomas H. Green, Leonard T. Hobhouse and John A. Hobson in the UK, and in the US by Lester Frank Ward, John Dewey and others.

These “new liberals” saw individual liberty as something achievable only under favourable social and economic conditions. Poverty and ignorance were barren soils for individual freedom and fulfilment. They argued that individual flourishing required the development of an education system, a welfare state and other state action to reduce unemployment and poverty.

John A Hobson

Thinkers such as Green, Hobhouse, Hobson, Ward and Dewey have been described as new liberals. But their ideas are no longer new and the label is in little use today. It also risks confusion with the now-ubiquitous and over-stretched swear-word of neoliberalism.

Social liberalism is another term that has been to describe the strain of liberal thinking – from Green to Dewey – that pursued greater state intervention and a welfare state.

But a problem with this label lies in the multiple meanings of the word social. Many used social liberalism to signal an emphasis on the need for cooperation between individuals through social arrangements to further human fulfilment. The word social here is used in a broad and inclusive sense.

An alternative understanding of social is exclusive: social is regarded as an antithesis to economic. This commonplace but problematic dichotomy contrasts the economic sphere of business and profit-seeking with the social sphere of the family, non-market relations, reciprocity and so on.

This enabled an alternative interpretation of social liberalism as liberalism applied to the narrowly-conceived social sphere. It would involve, for example, the promotion of homosexual rights and the decriminalization of the use of recreational drugs. Worthy as those aims may be, this is a much narrower agenda than that promoted by social liberalism in the broader sense.

Another option is the word solidarism. Inspired by Émile Durkheim and Léon Bourgeois, ideas emerged in France that were similar to and at about the same time as the new liberalism of Hobhouse and Hobson in Britain.

The solidarists criticized extreme laissez-faire and argued that individuals had a debt to society as a whole, which should be repaid through taxation and social welfare schemes. But solidarism in France took a distinctive form, putting more limited emphasis on state intervention than the proposals of some of their British counterparts.

Ambiguities of social democracy

A final term to be considered here is social democracy. This has shifted more successfully in meaning than socialism, but originally they amounted to more or less the same thing. Many of the early social democratic parties were led by Marxists, including the important Social Democratic Workers’ Party of Germany, founded in 1869. Although some social democrats favoured peaceful reform rather than violent revolution, at that time they mostly agreed on the goal of large-scale common ownership.

Harold Wilson

During the twentieth century the usage of the term social democracy shifted radically. After the Second World War it came to mean the promotion of greater economic equality and social justice within a capitalist economy. It also connoted a political strategy orientated toward the interests of the trade unions and the working class.

The term social democracy still carries this historical and strategic baggage. It has been eschewed by some because of its links with socialism. Others argue that its strategic, class-orientated vision has become obsolete. Another problem is that the word social does not make a clear addition to democracy, which few would oppose.

Post-war social-democratic policies are challenged by the fragmentation of their traditional base in the organized working class and by the heightened forces of globalization.

Consequently, while a reformed and reinvigorated social democracy may have some mileage, I suggest we consider the alternative term liberal solidarity to describe an important zone within liberalism. We should examine its principles and its agenda for reform. But first it is necessary to deal with the tricky label and substance of neoliberalism.

Original diversity within the Mont Pèlerin Society

The Mont Pèlerin Society changed in substance and direction. It began under a different name in the 1930s and was first convened under its current name in 1947. It was then an attempt to convene different kinds of liberals in defence of a liberal market economy, just after the defeat of fascist tyranny, during an expansion of Communist totalitarianism, and while witnessing the rise of statist socialist ideas in Western Europe and elsewhere. Liberalism broadly was on the rocks: it needed its defenders.

Michael Polanyi

Michael Polanyi (the brother of Karl Polanyi) advocated Keynesian macroeconomics in a market economy, alongside a radical redistribution of income and wealth. He rejected a universal reliance on market solutions, seeing it as a mirror image of the socialist panacea of planning and public ownership. He did not mince his words against this “crude Liberalism”:

“For a Liberalism which believes in preserving every evil consequence of free trading, and objects in principle to every sort of State enterprise, is contrary to the very principles of civilization. … The protection given to barbarous anarchy in the illusion of vindicating freedom, as demanded by the doctrine of laissez faire, has been most effective in bringing contempt on the name of freedom … .”

Although he attended the first meeting of the Mont Pèlerin Society, Polanyi had drifted away by 1955, stressing its inadequate solutions to the problem of unemployment and its promotion of a narrow view of liberty as the absence of coercion, neglecting the need to prioritize human self-realization and development.

In its early years, the Mont Pèlerin Society hosted debates on the possible role of the state in promoting welfare, on financial stability, on economic justice, and on the moral limits to markets. Like Polanyi and other early members of the society, Wilhelm Röpke argued that the state was necessary to sustain the institutional infrastructure of a market economy. The state should serve as a rule-maker, enforcer of competition, and provider of basic social security. Röpke’s ideas were highly influential for those laying the foundations of the post war West German economy.

While they received a more sympathy from Hayek, Ludwig Mises regarded Röpke’s views as “outright interventionist”. Mises became so frustrated with these arguments in favour of a major role for the state that he stormed out of a Mont Pèlerin Society meeting shouting: “You’re all a bunch of socialists.”

The rise of modern neoliberalism

Angus Burgin’s history of the society shows how its early period of relative inclusivity was followed by schisms, departures, and a narrowing of opinion. People like Polanyi and Röpke became inactive. Eventually the primary locus of the Mont Pèlerin Society shifted to the US, with greatly increased corporate funding under the rising intellectual leadership of Milton Friedman.

Milton Friedman

Hence the Mont Pèlerin Society evolved from a broad liberal forum to one focused on promoting a narrow version of liberalism that is more redolent of Herbert Spencer than of Adam Smith, Thomas Paine or John Stuart Mill. This ultra-individualist liberalism entailed a narrow definition of liberty as the absence of coercion, it relegated the goal of democracy, it neglected economic inequality, it overlooked the limits to markets, it saw very limited grounds for state welfare provision and intervention in financial markets, and it stressed self-interest rather than moral motivation.

But in the seventh dimension it tolerated a multiplicity of positions, as exemplified by Friedman’s opposition to the Iraq War. In all of the seven dimensions of liberalism, the post-1970 position of the Friedman-led Mont Pèlerin Society was redolent of Spencer, but without some of the latter’s Victorian idiosyncrasies. In the first six dimensions, this post-1970 neoliberalism is very different from liberal solidarity.

It is only after the 1960s that the Mont Pèlerin Society acquired a narrower identity, which at a pinch might be described as neoliberalism. Here Mirowski is onto something: “Neoliberals seek to transcend the intolerable contradiction by treating politics as if it were a market and promoting an economic theory of democracy.” In other words this neoliberalism reduces, all of politics, law and civil society as markets, and are analysed using market categories.

Neoliberalism’s affinity with Marxism

This neoliberalism has an odd similarity with Marxism, despite other major differences in theory and policy. Marx and Engels also reduced civil society to economic matters of money and trade. Marx wrote in 1843: “Practical need, egoism, is the principle of civil society … The god of practical need and self-interest is money.”

Karl Marx

Civil society, for Marx, was the individualistic realm of money and greed. Hence Marx concluded that “the anatomy of civil society is to be sought in political economy.” The analysis of the political, legal and social spheres was to be achieved with an economics based on the assumption of individual self-interest.

Furthermore, the state, law and politics under capitalism were made analytically subservient to this dismembered, economistic vision of civil society.

Accordingly, Frederick Engels wrote in 1886 that under capitalism “the State – the political order – is the subordinate, and civil society – the realm of economic relations – the decisive element.” Everything was deemed a matter of greed and commerce, to be understood through economic analysis.

Hence, in its theory of capitalism, classical Marxism was a harbinger of modern neoliberalism, reducing everything to market relations. There was no defence of civil society in its own right.

When attempts were made to build socialism on Marxist principles, not only markets were minimized but also civil society was virtually destroyed. Before 1989, the restoration of civil society was one of the foremost demands of the dissident movements in Eastern Europe.

Certainly there are more sophisticated and less reductionist treatments by Marxists of civil society and the state, not least by Antonio Gramsci. But Marx and Engels, alongside some neoliberals, embraced economic reductionism. Everything turns into the economics of trade, eclipsing the autonomy of politics and law, and neglecting the vital importance of non-commercial interaction and association within civil society.

Neoliberalism versus liberal solidarity

On these vital issues, liberal solidarity stresses its differences from both neoliberalism and classical Marxism. It does not treat the individual purely as a self-interested, market-oriented maximizer. It is committed to democracy as a distinctive source of legitimation for government, and a means of individual and social development (dimension 2), not as a marketplace for power.

Liberal solidarity stresses the feasible and moral limits to markets (dimension 4). It upholds a view of the individual that combines measures of self-interest with a moral concern for justice and fairness (dimension 6). On all these points it is distinct from these other doctrines.

Today, liberal solidarity must emphasise its radical differences from both post-1970 neoliberalism and from Marxism. This is made extremely difficult in a leftist intellectual context when any defence of markets or private enterprise, to any extent or degree, is pushed aside as neoliberal. Current cavalier uses of the term do much more harm than good.

Many so-called anti-neoliberals are also anti-liberals. They prioritize neither liberty nor freedom of expression. They offer no defence of private enterprise or markets, to any extent or in any form. They promote a state-dominated economy, which we know from history will always threaten freedom and human rights. They believe they are principled. They may have good intentions. To quote from their mentor Lenin: “The road to hell is paved with good intentions.” But as Marxists fail to understand, the only principled and effective defence of human rights is some form of liberalism.

Liberalism has to be fortified, but not in all of its forms. Liberal solidarity is the radical alternative to the illiberal or undemocratic populisms of the left or right. It can address the problems created by large corporate interests, by the power of undemocratic capitalist technocrats or by incipient dictatorships. It emphasises the importance of markets and private property, but without regarding them as universal panaceas. It retains uppermost the importance of human rights and human cooperation, with the goal of human flourishing and social development.

 

19 August 2018

Published by University of Chicago Press in January 2018

 

References

Burgin, Angus (2012) The Great Persuasion: Reinventing Free Markets since the Depression (Cambridge MA: Harvard University Press). See pp. 16, 80-86, 121.

Hodgson, Geoffrey M. (2015) Conceptualizing Capitalism: Institutions, Evolution, Future (Chicago: University of Chicago Press).

Hodgson, Geoffrey M. (2018) Wrong Turnings: How the Left Got Lost (Chicago: University of Chicago Press).

Jacobs, Struan and Mullins, Phil (2016) ‘Friedrich Hayek and Michael Polanyi in Correspondence’, History of European Ideas, 42(1), pp. 107-30.

Marx, Karl and Engels, Frederick (1962) Selected Works in Two Volumes (London: Lawrence and Wishart). See vol. 1, pp. 362, 394-5.

Marx, Karl and Engels, Frederick (1975) Karl Marx and Frederick Engels, Collected Works, Vol. 3, Marx and Engels: 1843-1844 (London: Lawrence and Wishart). See p. 172.

Mirowski, Philip (1998) ‘Economics, Science and Knowledge: Polanyi vs. Hayek’, Tradition and Discovery: The Polanyi Society Periodical, 25(1), pp. 29-42.

Mirowski, Philip (2009) ‘Postface: Defining Neoliberalism’, Mirowski, Philip and Plehwe, Dieter (eds) (2009) The Road from Mont Pèlerin: The Making of the Neoliberal Thought Collective (Cambridge MA: Harvard University Press), pp. 417-55. See p. 456.

Mirowski, Philip (2013) Never Let a Serious Crisis Go to Waste: How Neoliberalism Survived the Financial Meltdown (London and New York: Verso). See p. 71.

Polanyi, Michael (1940) The Contempt of Freedom: The Russian Experiment and After (London: Watts). See pp. 35 ff., 57-58.

Polanyi, Michael (1945) Full Employment and Free Trade (Cambridge: Cambridge University Press). See pp. 142-6.

Polanyi, Michael (1951) The Logic of Liberty: Reflections and Rejoinders (London: Routledge and Kegan Paul).

Posted in Democracy, Karl Marx, Left politics, Lenin, Liberalism, Ludwig von Mises, Markets, Michael Polanyi, Neoliberalism, Philip Mirowski, Private enterprise, Property, Right politics, Socialism

July 9th, 2018 by geoffhodgson1946

 

Despite their declared support for free trade, Tory libertarians like David Davis and Jacob Rees-Mogg are acting as if there were still a British Empire.

 

Geoffrey M. Hodgson

 

The Brexiteers in the Tory Party do not understand the mechanics of modern trade and have no viable blueprint for Brexit.

Substantial harmonization of standards and regulations is required when trade crosses international borders. The EU Single Market enables massive gains from trade within a harmonized system of regulation. EU member states have a say in the development of those regulations, within a common system.

Outside the EU, the UK would have to replace a huge apparatus of EU-wide regulation that has grown up since 1973 when it joined. This regulatory legislation would be an even more formidable burden than any increased tariff levels that would be adopted if the UK leaves the EU Customs Union and Single Market.

This problem creates a dilemma for libertarians who distrust all state machines – especially large ones outside their national comfort zone. Hence, alongside nationalists and hard left socialists, libertarians were in the intellectual forefront of the 2016 Brexit vote in the UK, chiming in with overblown complaints about Brussels bureaucracy, made more strident because this bureaucracy spans national boundaries and is staffed by foreigners.

Some of these libertarians are atomistic individualists, unable to accept that markets consist of more than individuals in isolation. These libertarians are seemingly unaware that all trade and markets must involve commonly accepted rules, as well as the wills and assets of individuals. Markets, in short, are social institutions.

Entering or leaving markets requires dealing with systems of rules. In practice, exit from the EU Single Market means either that regulations have to be developed independently, thus reducing trade possibilities, or that EU regulations have to be accepted for future trade, while having little say in their formation.

The libertarian dilemma

Minimal-state libertarians are thus caught in a dilemma. They have either to accept the adjudications of a foreign court, thus dramatically violating their characteristic anti-state position, by accepting not only state legal system but one outside their homeland, or they have to curtail their cherished ideological ambitions for free trade and markets across national boundaries.

More generally, any contract between sellers and buyers across international boundaries requires agreement on the means of adjudication, if a dispute arises over its terms or fulfilment. Typically it is agreed that disputes will be resolved in the courts of one nominated country. The European Court of Justice was set up to deal with contractual disputes within the EU, and between EU traders and contracting businesses located outside the EU.

Regulatory harmonization and trade dispute adjudication create problems for libertarians. Just as big socialists believe in a fantasy world where the state can do everything, some libertarians believe in the obverse fantasy of a minimal state, where trade somehow operates without an extensive state legal infrastructure. As Jamie Peck put it, these “neoliberals” espouse “a self-contradictory form of regulation-in-denial”.

Nevertheless, when faced with the real world of business and contract, these libertarians acquiesce with the state machine and its legal system within their own national boundaries. Their nationalism means that they can live with that outcome.

But when trade crosses international boundaries, the problems of regulatory harmonization and dispute adjudication compel these libertarians to accept – especially when trading with a larger economic bloc – that disputes may have to be resolved in courts outside their national boundaries.

For closet nationalists in libertarian clothing, accepting the judgments of a foreign court is a step too far. The lenience granted to their national courts is not granted to those of foreigners.

Bring back the British Empire – and other fantasies

British nationalists in libertarian clothing may then call up another fantasy from the past. They can imagine that Britain is still a great power, and that it has the capacity to compel that all trade disputes be resolved in British courts. In their imagination these libertarians bring back the British Empire. Imperial power makes everyone else a rule-taker. They may talk of that bygone world in the corridors of Eton, but it is far beyond the reality of global power today.

Across the Atlantic, American nationalists in libertarian clothing perform ideological gymnastics by allying themselves with politicians such as Donald Trump. He an economic nationalist rather than an advocate of international free trade. As long as these dubious libertarians can concentrate their gaze on the domestic US market and avoid the world beyond, then with some additional fantasising they might continue to believe in their myth of a minimal state.

Instead of the Empire, a US national fantasy is the Wild West. Historically, this was a short-lived zone, partly out of reach of the state and its system of law. Deals were done, aside the barrel of a gun. It is the US version of a mythological libertarian paradise. Global reality today, however, is very different.

A third fantasy is the idea of Jeremy Corbyn that Britain can leave the EU and build socialism. This is a mythical as the other fantasies. Corbyn does not understand markets and has no viable blueprint either – but that is the subject of other blogs. In the meantime, we note that all these efforts to leave the EU are based on fantasies that have little connection to the world in which we live today.

9 July 2018

Published by University of Chicago Press in January 2018

References

Hodgson, Geoffrey M. (2015) Conceptualizing Capitalism: Institutions, Evolution, Future (Chicago: University of Chicago Press).

Hodgson, Geoffrey M. (2018) Wrong Turnings: How the Left Got Lost (Chicago: University of Chicago Press).

Peck, Jamie (2010) Constructions of Neoliberal Reason (Oxford and New York: Oxford University Press). See p. xiii.

Posted in Brexit, Donald Trump, Jeremy Corbyn, Left politics, Liberalism, Markets, Neoliberalism, Populism, Property, Right politics, Socialism, Uncategorized

June 1st, 2018 by geoffhodgson1946

 

 

Stretching the word “neoliberal” to cover people as different as Deng Xiaoping and Donald Trump has turned it into an absurdity.

 

Geoffrey M. Hodgson

 

Once upon a time, the word neoliberalism might have been confined to an extreme form of individualism that eschews state regulation, promotes economic austerity and a minimal state, opposes trade unions and vaunts unrestrained markets as the solution to all major politico-economic problems.

But today the usage of the word neoliberalism is no longer so restricted. I have been told more than once that anyone who is not a socialist is automatically a neoliberal. Any defence of the existence of markets now risks quick rejection with an angry neoliberal stamp upon it.

More frequently these days, a wide range of politicians, from Margaret Thatcher and Ronald Reagan at one extreme, to Bill Clinton, Hillary Clinton, Emmanuel Macron and Tony Blair at the other limit, are all described as neoliberals, despite, for example, hugely varied policies on taxation, government expenditure and the role of the state.

In their book on Neoliberalism, Damien Cahill and Martijn Konings describe the US President Donald Trump as a neoliberal. Yet he is a supporter of protectionism and he has imposed import tariffs: he does not believe in free trade. The word neoliberal is now stretched beyond credence and coherence.

Sneaky Deng Xiaoping was a neoliberal

Guardians of socialist purity have described some errant Marxist or socialists as neoliberals. In his Brief History of Neoliberalism, Marxist academic David Harvey described revisionist-Marxist Deng Xiaoping as a neoliberal.

From 1978, Deng supported the reintroduction of markets into the Chinese economy. But he still proposed a strong guiding hand by the state, including centralized management of the macro-economy and the financial system.

Harvey admitted that Deng’s policies led to strong economic growth and “rising standards of living for a significant proportion of the population” but he passed quickly over this ellipsis.

In fact, Deng’s Marxist-revisionist “neoliberal” reforms lifted more than half a billion people out of extreme poverty, albeit unevenly and at the cost of greater inequality. That was about one-twelfth of the entire world population in 2000. With this development, China halved the global level of extreme poverty. The bulk of the poverty reduction in China came from rural areas.

This achievement is unprecedented in human experience. If China’s extension of markets is neoliberalism, then neoliberalism is the most beneficial economic policy in history.

Vladimir Lenin and Josip Tito as neoliberals

But earlier contenders for the title of “the first neoliberals” can be found. In her book on Markets in the Name of Socialism: The Left-Wing Origins of Neoliberalism, the sociologist Johanna Bockman found roots of neoliberalism in the experiments in so-called “market socialism” in Josip Tito’s Yugoslavia from the 1950s and in Hungary from the 1960s.

There is no stopping this neoliberal treachery – infiltrating socialism as well as capitalism!

Josip Tito

Adopting the methodology of Harvey and Bockman, I would like to nominate Vladimir Ilyich Lenin as the first neoliberal, for his betrayal of socialist central planning and his introduction of the New Economic Policy (NEP) in Soviet Russia in 1921. In this admitted “retreat” from socialism, Lenin re-introduced markets and profit-seeking private firms.

Crucially, in support of this nomination, there is evidence that Deng’s post-1978 reforms drew a strong inspiration from Lenin.

“A brainless synonym for modern capitalism”

Of course, I am being ironic. My point is that, thanks to Harvey and others, neoliberalism as a term has become virtually useless. As Philip Mirowski and Dieter Plehwe put it, neoliberalism for some has become “a brainless synonym for modern capitalism.”

Mirowski also complained that opponents “often bandy about attributions of ‘neoliberalism’ as a portmanteau term of abuse”. But Mirowski did not drop the term.

Geoffrey Hodgson & Philip Mirowski

In his superb history of the Mont Pèlerin Society, Angus Burgin commented critically on the term neoliberalism:

“It is extremely difficult to treat in a sophisticated manner a concept that cannot be firmly identified or defined.”

The word is no longer sound currency. Bad usage has driven out the good. It has become a swear-word rather than a scientific term.

Neoliberalism as a ruling class strategy

Part of the impetus behind the excessive and ultimately destructive use of the word neoliberal is the Marxist belief, expressed by David Harvey among others, that neoliberalism is a strategy serving the interests of the capitalist class.

Following the post-war settlement of 1945-1970, which conceded greater power and shares of income to organized labour, rising neoliberalism allegedly rescued the capitalist class.

Their evidence is that in several major countries from the 1970s, trade unionism declined in strength and the shares of national incomes going to the top five per cent increased.

There is some truth in this. But first it overlooks the fact that levels of public welfare expenditure generally did not decrease after the 1970s.

Second, in several countries, including most dramatically in China, standards of living have increased, even for the lower income deciles. While for many people in the US, real wages have stagnated, this has not been the case in several other countries, particularly prior to the 2008 crash.

Third, the argument may exaggerate the degree to which the capitalist class is united, in terms of their real interests or of their perceptions of them.

Fourth, it is questionable that capitalist interests are best served by declines in real wages, given the powerful Keynesian argument that capitalist prosperity depends on effective demand in the economy as a whole. Higher real wages can increase prosperity across the board, and serve the interests of capitalists and capitalism.

Fifth, there are other, possibility more effective, strategies for countering the power of organized labour and reducing the incomes of many people in favour of the top five per cent. These alternatives include economic nationalism, which can take the extreme form of fascism. Generally these are not free-market, small-state approaches. If they are all labelled neoliberal, and regarded as the grand global strategy of the bourgeoisie, then the analysis becomes dangerously insensitive to the increasingly probable threats of economic nationalism and fascism.

Neoliberalism and the Mont Pèlerin Society

Perhaps the most well-informed and intelligent attempt to give neoliberalism a distinctive meaning is by Philip Mirowski, who associates it, more or less, with the Mont Pèlerin Society.

But the Mont Pèlerin Society changed to a degree, in substance and direction. It began under a different name in the 1930s and was first convened under its current name in 1947. It was then an attempt to convene different kinds of liberals in defence of a liberal market economy, just after the defeat of fascist tyranny, during an expansion of Communist totalitarianism, and while witnessing the rise of statist socialist ideas in Western Europe and elsewhere. Liberalism broadly was on the rocks: it needed its defenders.

As a measure of the relative inclusivity and internal diversity of the Mont Pèlerin Society, consider the testimony of the philosopher Karl Popper, who was a friend of Hayek and a prominent Mont Pèlerin member in the early years. Popper wrote to Hayek in 1947 that his aim was “always to try of a reconciliation of liberals and socialists”.

Michael Polanyi and Wilhelm Röpke

Michael Polanyi – the brother of Karl Polanyi – was a founder member of the Mont Pèlerin Society. He advocated Keynesian macroeconomics in a market economy, alongside a radical redistribution of income and wealth. He rejected a universal reliance on market solutions, seeing it as a mirror image of the socialist panacea of planning and public ownership. He did not mince his words against this “crude Liberalism”:

“For a Liberalism which believes in preserving every evil consequence of free trading, and objects in principle to every sort of State enterprise, is contrary to the very principles of civilization. … The protection given to barbarous anarchy in the illusion of vindicating freedom, as demanded by the doctrine of laissez faire, has been most effective in bringing contempt on the name of freedom …”

Polanyi had drifted away from the Mont Pèlerin Society by 1955, stressing its inadequate solutions to the problem of unemployment and its promotion of a narrow view of liberty as the absence of coercion, neglecting the need to prioritize human self-realization and development.

Michael Polanyi

In its early years, the Mont Pèlerin Society hosted debates on the possible role of the state in promoting welfare, on financial stability, on economic justice, and on the moral limits to markets. Like Polanyi and other early members of the society, Wilhelm Röpke argued that the state was necessary to sustain the institutional infrastructure of a market economy. The state should serve as a rule-maker, enforcer of competition, and provider of basic social security. Röpke’s ideas were highly influential for those laying the foundations of the post war West German economy.

While they received a more sympathy from Hayek, Ludwig Mises regarded Röpke’s views as “outright interventionist”. Mises once became so frustrated with these ongoing arguments in favour of a major role for the state that he stormed out of a Mont Pèlerin Society meeting shouting: “You’re all a bunch of socialists.”

The rise of Milton Friedman

Angus Burgin’s history of the society shows how its early period of relative inclusivity was followed by schisms, departures, and a narrowing of opinion. People like Polanyi and Röpke became inactive. Eventually the primary locus of the Mont Pèlerin Society shifted to the US, with greatly increased corporate funding under the rising intellectual leadership of Milton Friedman.

Milton Friedman

Hence the Mont Pèlerin Society evolved from a broad liberal forum to one focused on promoting a narrow version of liberalism that is more redolent of Herbert Spencer than of Adam Smith, Thomas Paine or John Stuart Mill.

This ultra-individualist liberalism entailed a narrow definition of liberty as the absence of coercion, it relegated the goal of democracy, it neglected economic inequality, it overlooked the limits to markets, it saw very limited grounds for state welfare provision and intervention in financial markets, and it stressed self-interest rather than moral motivation.

Perhaps Friedman was a neoliberal. Perhaps Hayek too. But if we add Lenin, Tito, Deng or Trump to the list, then we are in the realms of absurdity – the term becomes useless.

 

1 June 2018

This book elaborates on the issues raised in this blog:
Published by University of Chicago Press in January 2018

 

Bibliography                                                     

Bockman, Johanna (2011) Markets in the Name of Socialism: The Left-Wing Origins of Neoliberalism (Stanford: Stanford University Press).
Burgin, Angus (2012) The Great Persuasion: Reinventing Free Markets since the Depression (Cambridge MA: Harvard University Press). See esp. pp. 57, 80-86, 116, 121.
Cahill, Damien and Konings, Martijn (2017) Neoliberalism (Cambridge UK and Medford MA: Polity Press). See esp. pp. 144-5.
Harvey, David (2005) A Brief History of Neoliberalism (Oxford and New York: Oxford University Press). See esp. pp. 1-3, 120-22.
Hodgson, Geoffrey M. (2015) Conceptualizing Capitalism: Institutions, Evolution, Future (Chicago: University of Chicago Press).
Hodgson, Geoffrey M. (2018) Wrong Turnings: How the Left Got Lost (Chicago: University of Chicago Press).
Jacobs, Struan and Mullins, Phil (2016) ‘Friedrich Hayek and Michael Polanyi in Correspondence’, History of European Ideas, 42(1), pp. 107-30.
Mirowski, Philip (2013) Never Let a Serious Crisis Go to Waste: How Neoliberalism Survived the Financial Meltdown (London and New York: Verso). See esp. pp. 29, 71.
Mirowski, Philip and Plehwe, Dieter (eds) (2009) The Road from Mont Pèlerin: The Making of the Neoliberal Thought Collective (Cambridge MA: Harvard University Press). See esp. p. xvii.
Pantsov, Alexander and Levine, Steven I. (2015) Deng Xiaoping: A Revolutionary Life (Oxford and New York: Oxford University Press). See esp. p. 373.
Polanyi, Michael (1940) The Contempt of Freedom: The Russian Experiment and After (London: Watts). See esp. pp. 35 ff., 57-58.
Ravallion, Martin, and Shaohua Chen (2005) ‘China’s (Uneven) Progress against Poverty’, Journal of Development Economics, 82(1), pp. 1-42.

 

Posted in Donald Trump, Left politics, Lenin, Liberalism, Markets, Michael Polanyi, Neoliberalism, Philip Mirowski, Private enterprise, Right politics, Soviet Union, Tony Blair, Uncategorized

January 11th, 2018 by geoffhodgson1946

 

Geoffrey M. Hodgson

 

Although education is not a public good, there are good reasons why the state should support education services.

 

As leader of the UK Labour Party, Jeremy Corbyn has opined that “education is a public good” and drawn the conclusion that it should all be provided by government and funded by taxation.

All three leaders of the UK Green Party since 2012 – Nathalie Bennett, Caroline Lucas and Jonathan Bartley – have repeated the phrase “education is a public good”. They too implied that all education should be free of charge to the user and paid for out of taxation.

Jeremy Corbyn and Caroline Lucas

Similarly, Shakira Martin, who was elected President of the UK National Union of Students in 2017, remarked: “Education is a public good and should be paid for through taxation.” These influential organizations are led by people who have not learned the lessons of Econ 101.

In addition, this inaccurate rendition of the meaning of public good is common among journalists, who also have a moral responsibility to use terms accurately.

What is a public good?

The economist and Nobel Laureate Paul Samuelson established the concept of a public good in an academic paper in 1954, although some of the basic ideas involved had been formulated previously by others.

John Stuart Mill, for example, had argued in his Principles of Political Economy that lighthouses should be built and financed by governments, because their widespread benefits could not readily be financed by passing ships, and no individual had the pecuniary incentive to construct them.

The established technical definition of a public good is a good or service that is non-rivalrous and non-excludable. Non-rivalrous means that its use or consumption by any actor does not significantly reduce the amount available for others.

Non-Rivalrous Consumption

Non-excludable means that potential users cannot practically be excluded from the use of the good or service. This definition can be confirmed by reading any reputable economics textbook.

Consider the example of street lighting. If a town council uses local tax revenues to set up and maintain lighting on its streets, then there are widespread benefits for everyone. But it is not possible to charge people individually, according to whether they benefit from the illumination.

So when elections to the town council occur, self-interested citizens will vote for candidates proposing lower taxes, assuming that they will benefit anyway from any public good provision. Why pay more taxes when the lighting is free at the point of use? Self-interested consumers will try to hitch a free-ride. The outcome is that the street lighting will be underfunded, while everyone would prefer streets that are well-lit.

Free Riders

Samuelson’s argument was popularized by John Kenneth Galbraith in his 1958 book The Affluent Society. Therein Galbraith argued that vital public goods would be under-provided in a market system: there could be the coexistence of “private opulence and public squalor”. The combined efforts of a revered mainstream economic theoretician and of an astute and inventive populariser of economic wisdom helped to pave the way for a wave of interventionist policies in the US and other developed economies.

Do public goods necessitate public provision?

After this action came the reaction. In a 1974 article Ronald Coase (another Nobel Laureate) argued that many early lighthouses in England were privately constructed and financed by tolls at the ports. In fact, an emblematic example of a public good had often been financed privately. Hence “economists should not use the lighthouse as an example of a service which could only be provided by government”.

Ronald Coase

This and other interventions led to a widespread reaction against the Samuelson-Galbraith view that public goods necessarily require public provision or public financing.

It has been pointed out that radio and TV broadcasts and open-source computer software are also public goods. Yet both are often provided by private companies. Private radio and TV broadcasters finance their broadcasts by advertising.

Computer companies sometimes make software readily available to encourage use of their computers, for which the software was designed. The software is given away to help sell the hardware, or there is a charge for support services for software users.

Whether they are desirable or not, in principle there are many possibilities for private provision of public goods. In reality there are numerous cases where the state franchises out the provision of goods or services to private contractors. Such provision could include public goods. In these cases, public financing remains, but provision is private.

The claimed advantages of private franchising would include the introduction of an element of competition between potential franchisees, and the possibilities of efficiency gains through well-focused, relatively autonomous private providers. But here again the proof of the pudding is in the eating. Many public franchising operations have failed to deliver the promised gains. Others have been more successful.

Accordingly, we end up with a pragmatic rather than a doctrinaire conclusion. Economic systems are complex, with varied, interconnected components. Theory simplifies, and does not catch all the interactive effects. Theory has continuously to be appraised in the light of empirical experience. So far it is clear than the existence of a public good does not necessarily imply that it has to be provided by government, just as there is no compelling case that its private provision will also be superior.

Misunderstanding the meaning of a public good

Careful, rational discussion of the issues surrounding vital debates over public and private provision is not simply impeded by the prevalence of opposing ideological extremes. There is also a growing and prominent disrespect for the careful use of the terms that have been established by scholars in this area.

Combinations of sloppiness and ignorance threaten the utility of key terms. They engender ambiguity, degradation and ultimate uselessness. This has already happened with swear-words such as neoliberalism. It is hoped that it does not happen with cheer-words such as public good.

A prominent misunderstanding of “public good”, is that it means “a good that can only, or should only, be provided by government”. But this conflation of public good with public provision is mistaken.

Another, even cruder, misunderstanding is that “public good” means “good for the public”. While anyone who has taken Econ 101 should spot this error, it is nevertheless widespread. Speakers sometimes give their error away when they give relative stress the “good” in the phrase, as if “good” had the meaning of virtuous or worthwhile.

Yet in the correct definition of “public good” the second word takes another commonplace meaning, denoting a possession, or an item of commerce. This second meaning is found in the pledge “with all my worldly goods I thee endow” in the Book of Common Prayer or in “the goods train went through the station”. Bad things, like tobacco, heroin, cocaine, nuclear bombs and personnel mines, are also goods in this sense.

Is education a public good?

First assume that the claims of Corbyn, Lucas and others were true: education is “good for the public” and it should be funded out of taxation, and maybe even provided by a publicly-owned enterprise.

Many additional things are “good for the public”, including clothing, food and housing. By the same logic, these “goods” should all be funded out of general taxation as well, and distributed without further charge to their users. Influential politicians thus suggest that everything that serves basic needs should be financed, and possibly distributed, by the state. The market would simply be left for luxuries. Their logic implies a state-run economy of which Stalin and Mao would be envious.

Second, even if education were a public good (by the Econ 101 definition) then this would not imply that it should be paid for out of taxation. As noted above, free radio and TV broadcasting is generally a public good, but little of it is paid out of taxation, and it would be difficult to make the case that it should be (unless we fancy a totalitarian state that does all the broadcasting and curtails all private radio and TV stations).

Third, while observing the Econ 101 definition of a public good, note that education is generally a rivalrous rather than a non-rivalrous service. Education services require resources, including buildings, infrastructure, equipment and trained teachers. Additional students generally require additional resources. (Although in some cases the marginal cost is low, such as with mass-distributed online courses.) Consequently, education provision is generally rivalrous.

Fourth, again with an eye on the Econ 101 definition, note that education services are mostly (but not entirely) excludable. Schools and universities can readily prevent other people from attending, while it is much more difficult to prevent any passing mariner from observing the light from a lighthouse.

Technically, by the standard definition, most education services are private goods, because their provision is both excludable and rivalrous. But there is no necessary reason why all private goods should be privately provided. The Econ 101 distinction between public and private goods does not readily or directly correspond with public and private provision respectively.

The parts of an education system that are actually or virtually non-rivalrous, such as massive online courses, are technically club goods. Like radio and TV broadcasting they can be provided publicly or privately.

Positive externalities in education

When students receive their qualifications, they often have advantages over others on the jobs market. Hence they reap benefits. Nevertheless, with education there are strong positive spill-over effects.

Educated people help to raise the levels of public culture and discourse, and can pass on some of their skills to others. Educated people are also vital for a healthy democracy. But none of this undermines the general excludability of education services.

The spill-over effects are important, and relate to the question of public versus private provision. Another word for a spill-over is an externality: this is a cost or benefit that affects someone who did not choose to incur that cost or benefit.

Externalities can be positive or negative. Examples of negative externalities are pollution or congestion caused by motor cars. Because a driver will suffer only a fraction of the overall pollution and congestion costs of making a car journey, negative externalities impose costs on others without penalty for the car user. By standard assumptions, unless compensatory measures are taken, car use will be excessive and suboptimal.

Arthur Pigou

The theory of externalities was developed by Arthur Pigou, who argued that in the presence of negative externalities some public authority should intervene to impose taxes or subsidize superior alternatives. By such measures, motor car traffic could be reduced and pollution reduced. Inversely, services such as education with positive externalities should receive subsidies or be provided free, to encourage more extensive participation in these activities.

In a famous 1960 paper, Coase dramatically changed the terms of debate with his argument that if transaction costs were zero, then all the extra costs or benefits could be subject to contractual arrangements and the externalities would disappear. For example, if the owner of every dwelling near a road had property rights in the surrounding segment of the atmosphere, then the driver of a passing and polluting car could be sued for degradation of that property. The pollution externality would be internalized.

Coase’s intention was to underline the implications of transaction costs: the existence of externalities is dependent on positive transaction costs. Coase accepted that in many cases it would be impossible to avoid the transaction burden. For example, enforcing rights in the surrounding atmosphere to curb pollution may be too expensive.

Many pro-market zealots ignored or underestimated the transaction-cost aspect of Coase’s argument. Instead, their foremost claim was that Coase had undermined the case of public intervention based on externalities.

Consider the positive externalities of education. It would be impossible or socially destructive for every educated person to charge a fee to participants in an intellectual dinner conversation, or to invoice the government for making a well-informed choice when casting his or her vote in the ballot box. The internalization of these positive externalities by such means is impossible or undesirable.

The issue of missing markets is relevant here, as I discuss in my book Conceptualizing Capitalism. There are missing markets for future employment because to introduce such complete markets would be tantamount to slavery. The prohibition of slavery means that we cannot have complete futures markets for labour. This means not simply the existence of transaction costs but the enforced absence of transactions, which would be equivalent to making the transaction costs infinite.

Consequently, because of these missing markets, education and training will be undersupplied through markets under capitalism. There is a rationale for some kind of public intervention. Of course, government intervention has its problems too. We must experiment, and compare real-world cases, not idealized models.

Mixtures of public and private provision

There are mixtures of public and private provision of education in most countries. The majority of schools in most countries are run by local government. At the other extreme, most on-the-job training is done by private companies.

The US has a mixture of private and state universities, although both types receive substantial public funds. In the UK most universities receive public money for teaching and research, and in return they are obliged to conform to a myriad of government regulations. They also receive student fees and research grants from the private sector.

Technically all UK universities are private (corporate) entities: they have a legal status equivalent to charities (which are also not-for-profit private corporations). By contrast, in several major countries in Continental Europe and elsewhere, most universities are integrated into the state machinery and all their employees are civil servants. This is not the case in the US or the UK. This international diversity of models provides the opportunity to compare different systems and determine what works best, taking account of the different contexts in which they operate.

J’accuse: abetting Trumpism

A growing danger in world politics – including in the UK and US – is the wilful rejection of the ideas of experts, of the academic community and of science in general. Hence President Donald Trump denies the science of climate change and cries that it is a hoax. UK Cabinet Minister Michael Gove says we listen too much to experts.

This growing disrespect for science and expertise is moving democracies toward an extremely dangerous place, where the general public have increasing difficulty segregating lies from truth. This danger could be called Trumpism.

I do not put Jeremy Corbyn or Caroline Lucas in the same box as Trump. Far from it. For example, they share none of his obnoxious racism and sexism. But Corbyn and Lucas are disrespecting experts and ignoring bits of science nevertheless.

We need a well-informed public conversation concerning the best arrangements for the (public or private) provision of basic needs and services, including education, health, housing and transport. Such a debate is much more difficult if leading public figures, including the leaders of major political parties, promote incorrect and misleading versions of highly relevant analytical terms.

Donc, je les accuse – of abetting the Trumpist degeneration of public discourse with their false claim that “education is a public good”. They should acknowledge the error and make a correction.

 

11 January 2018

 Minor edits: 12-13 January 2018

 

Published January 2018

Appendix

Note 1: As with many such definitions, there are few, if any, pure cases. So a public good refers to a good or service where consumption by one person does not significantly reduce the amount available for others, and where potential users cannot practically or generally be excluded from the use of the good or service.

Note 2: There is a widespread assumption that actors act wholly out of self-interest. But from evidence with humans in laboratory experiments and elsewhere, we know now that this is untrue. People will often agree to pay for public goods, even if they know that they have the alternative of free-riding on the contributions of others. One can conjecture, however, that numbers of people are important. We know from the work of Nobel Laureate Elinor Ostrom (1990) and others that cooperation is possible over the use of non-excludable resources, even when usage is rivalrous and it can degrade the resource. (Non-excludable resources that have rivalrous usage are defined as common-pool resources: they are not public goods.) But Ostrom’s examples highlight the role of face-to-face interaction and the building of trust. But it is doubtful that these mechanisms can be expanded to large-scale societies, at least without additional systems of control and enforcement.

 

Bibliography                   

                              

Bennett, Nathalie (2017)) “#Nathalie4Sheffield – Issues: Young People”. https://www.natalie4sheffield.org/issues/young-people .

Coase, Ronald H. (1960) ‘The Problem of Social Cost’, Journal of Law and Economics, 3(1), October, pp. 1-44.

Coase, Ronald H. (1974) “The Lighthouse in Economics”, Journal of Law and Economics, 17(2), October, pp. 357-76.

Galbraith, John Kenneth (1958) The Affluent Society (London: Hamilton).

Hodgson, Geoffrey M. (2015) Conceptualizing Capitalism: Institutions, Evolution, Future (Chicago: University of Chicago Press).

Hodgson, Geoffrey M. (2018) Wrong Turnings: How the Left Got Lost (Chicago: University of Chicago Press).

Martin, Shakira (2017) “National Union of Students Responds to PM Review of Student Funding”, NUS Connect, 1 October. https://www.nusconnect.org.uk/articles/national-union-of-students-responds-to-pm-review-of-student-funding .

Mill, John Stuart (1871) Principles of Political Economy with Some of their Applications to Social Philosophy, 7th edn. (London: Longman, Green, Reader and Dyer).

Ostrom, Elinor (1990) Governing the Commons: The Evolution of Institutions for Collective Action (Cambridge: Cambridge University Press).

Pigou, Arthur C. (1920) The Economics of Welfare (London: Macmillan).

Rampen, Julia (2016) “Caroline Lucas and Jonathan Bartley: ‘The Greens can win over Ukip Voters too’“, New Statesman, 21 October. https://www.newstatesman.com/politics/staggers/2016/10/caroline-lucas-and-jonathan-bartley-greens-can-win-over-ukip-voters-too .

Samuelson, Paul A. (1954) “The Pure Theory of Public Expenditure”, Review of Economics and Statistics. 36(4), pp. 387-9.

Stretton, Hugh and Orchard, Lionel (1994) Public Goods, Public Enterprise, Public Choice: Theoretical Foundations of the Contemporary Attack on Government (London and New York: Macmillan and St Martin’s Press).

Walker, Peter (2017) “Jeremy Corbyn: UK Firms Must Pay More Tax to Fund Better Education”, The Guardian, 6 July. https://www.theguardian.com/politics/2017/jul/06/jeremy-corbyn-uk-firms-must-pay-more-tax-to-fund-better-education .

 

Posted in Caroline Lucas, Common ownership, Donald Trump, Green Party, Jeremy Corbyn, Labour Party, Left politics, Liberalism, Markets, Nationalization, Neoliberalism, Politics, Private enterprise, Property, Right politics

September 20th, 2017 by geoffhodgson1946

 

 

Geoffrey M. Hodgson

 

I was born in 1946. I lived in a council house until I was 16. My family were Labour. My privilege was not money, but that my parents and grandparents all valued education and culture. But none of them obtained a university degree, because they were less accessible at the time.

Harold Wilson

I became involved in the Labour Party in 1964 and then saw myself as a Tribune socialist following the steps of great radicals such as Michael Foot. After welcoming Harold Wilson’s election victory in 1964, I became critical of the new Prime Minister because of his nominal support for the US in the Vietnam War.

Vietnam and Marxism

For my baby-boom generation, the Vietnam War was a great generator of radicalism. Like many of my university friends, I became a Marxist in 1966. We were drawn into a turbulent and exciting world that combined activism with ideas and debate. I saw myself as a Marxist until about 1980.

I studied mathematics and philosophy from 1965 to 1968 and economics from 1972 to 1974. Both periods were at the University of Manchester. In the intervening years I taught myself Marxist economics. My knowledge of economics became enduringly significant in my political evolution.

I was at the LSE student occupation in 1967 and one of the Grosvenor Square demonstrations in 1968. In that year I copied Bertrand Russell and tore up my Labour Party membership card in protest against US aggression in Vietnam.

Marxists dominated the activists on the university campuses. The left was divided and fractious. There were Soviet Bloc loyalists in the Communist Party of Great Britain. There were lovers of Mao Zedong and several rival Trotskyist sects. I could not bring myself to support any totalitarian regime – East or West – so I joined the forerunner of what is now the Socialist Workers’ Party, which saw everything existing as “capitalist”.

My departure from the SWP came in 1971 when they expelled a dissident faction with which I sympathised. (That critical faction eventually became the Alliance for Workers’ Liberty, of Momentum fame in the Corbyn Era.)

I flirted briefly with the International Marxist Group, which included glamorous figures such as Tariq Ali, and Robin Blackburn of the New Left Review. The IMG was stronger in its support for the women’s movement and for gay rights.

After a few years among the sects I could see that something was wrong. These groups were aiming to help create a much better society, but they were generally dogmatic and intolerant. Some were ruthless, pugnacious and fanatical. I did not want to see any social system facilitated or run by these people.

But on the other hand I then accepted the Marxist view that capitalism was exploitative and frequently led to oppression and war. The evidence of this was seemingly before our eyes.

Re-joining Labour and changing strategy

After Labour’s electoral defeat in 1970, there was a strong and growing left in the Labour Party and that seemed the best hope for socialists. Against the advice of Ralph Miliband (whom I knew personally) and others, I re-joined Labour in 1974.

In 1975 I published a pamphlet entitled Trotsky and Fatalistic Marxism. This tried to explain the fanaticism and intolerance of many Marxists in terms of their belief in the imminent decay and collapse of capitalist democracies. Trotskyists had failed to appreciate the enormous expansion and dynamism of capitalism after 1945. Their explanations of the survival of capitalism were weak.

Published in 1977, a longer work entitled Socialism and Parliamentary Democracy elaborated more of my thinking. Marxist-Leninists believed that parliament and the capitalist state should be “smashed”. Influenced by Max Weber and others, I argued that in modern democracies, government drew their perceived legitimacy from parliamentary elections. If socialism became a majority view, then socialists could and should gain a majority in parliament.

In the book I criticised the 1968 revolutionary movement in France for boycotting the elections called by President Charles de Gaulle in that year. Victory in the elections gave de Gaulle legitimacy. The huge movement of students and workers was crushed.

Paris – May 1968

As I had anticipated, my heresies were dismissed out of hand by the far left sects. But the book proved to be rather influential in the UK and internationally. It received a strongly sympathetic hearing on the Labour left. It was translated into Italian, Japanese, Spanish and Turkish. It persuaded a leading member of the violent Basque separatist group ETA to abandon terrorism.

I don’t know if he read my book, but Daniel Cohn-Bendit, the leader of the revolutionary movement in France in May 1968, later argued that it had been a mistake to boycott the French parliamentary elections.

Labour had been reconciled to the parliamentary road to socialism since its formation. The sects argued that it wouldn’t work. My response was that insurrection would not work either. In democracies we needed a combination of parliamentary and extra-parliamentary action.

Questioning ends as well as means

The killing fields in Cambodia affected me deeply. After seizing power in 1975 the Khmer Rouge forced everyone into the countryside and obliterated about two million people – a quarter of the Cambodian population – in the pursuit of their communist utopia.

I could not dismiss this as an aberration. After all, the Khmer Rouge aims, which included the abolition of money, private property and markets, were central to the Communist Manifesto by Karl Marx and Frederick Engels.

Khmer Rouge Killing Fields

The far left were able to publish papers and debate ideas because they lived in a democracy that tolerated freedom of expression. But the ideas and actions of the sects, if they gained influence or power, would curtail these very liberties upon which they had depended.

Crucially, I was not naïve enough to believe that freedom and political pluralism could be guaranteed simply by the goodwill of a more enlightened Marxist leadership, who valued these things more than the Khmer Rouge. Good intentions were not enough.

I had retained a good lesson from Marxism. Effective ideas and practices draw their strength from agglomerations of power sustained by the structures of the politico-economic system. Hence a genuinely pluralist and tolerant political sphere depended on pluralism and decentralisation in the economic domain. A pluralist polity requires a pluralist economy.

Beatrice & Sidney Webb

Prominent Labour thinkers such as Beatrice Webb, Sidney Webb and G. D. H. Cole had all argued for a decentralised socialist system. But they still sought the abolition of private property and markets. The state would ultimately own everything. So what institutional, legal or other politico-economic forces could stop it retrieving all delegated powers to the centre, when deemed required, or when goodwill wore thin?

Any viable socialism always needs markets

I came to the view that genuine and lasting decentralisation would depend on the existence of organisations with some genuine autonomy and legal independence, providing powers to own property and trade with other organisations. Any viable socialism would always need markets – it was not simply a matter of tolerating or compromising with them.

This crucial transition of my thinking occurred between 1977 and 1980. I cannot recall the detailed influences. But I am sure that the initial impetus did not come from Ludwig von Mises or Friedrich Hayek. I did not delve deeply into their works until the early 1980s.

János Kornai

There had been several socialist proposals to nationalise the sector producing capital goods but retain competition and markets for consumer goods. I was more attracted by the Hungarian economist János Kornai’s more sophisticated proposal (originally published in 1965) to use a dynamic combination of markets and planning, where planning provided strategic impetus, and markets signalled information and gave scope for innovation and planning adjustment.

Over the new year of 1979-1980 I went on a short tourist group visit to the Soviet Union. Some of my companions were dewy-eyed admirers of the system, but I was prepared for its flaws, including the ubiquitous black markets and corruption.

I had been given the address in Moscow of an Englishman married to a Russian. As a former Communist, he explained in detail in his apartment how and why his views had quickly changed: “I challenge any supporter of the Soviet Union to live here just for six months.”

Alec Nove

When Alec Nove published a classic article on feasible socialism in New Left Review in early 1980 I was ready for it. Nove also argued that markets were essential to any viable socialism. He realised that he was attacking deeply-ingrained orthodoxy on the left.

(Later I had the pleasure of meeting both Kornai and Nove several times. Nove died in 1994 but Kornai is still alive. I am delighted to be invited as a keynote speaker at a conference in his honour in Budapest in 2018.)

Labouring as a revisionist

Any acceptance of markets was an anathema to followers of both Karl Marx and Tony Benn. Benn distanced himself from those who supported the persistence of markets.

But I found common ground with Benn and others over what was called “the alternative economic strategy”. I outlined my positive views on this in a pamphlet entitled Socialist Economic Strategy in 1979. It was published by Independent Labour Publications.

Independent Labour Publications was the residue of the old Independent Labour Party, which had played a central role in Labour history from the 1890s to the 1940s. The Independent Labour Party split from the Labour Party in 1931. But in 1975 it formally dissolved as a party and rejoined Labour as Independent Labour Publications.

I was involved in this organisation briefly. Despite outward appearances they turned out to be another sect, lacking any vision of a workable socialism. They too were uneasy about my revisionism. Although my Socialist Economic Strategy was a bestseller by their standards, they refused to reprint it. We parted company in 1981.

Geoff Hodgson, Jean Shepherd & John Maguire in 1979

In 1979 I was the unsuccessful Labour Parliamentary Candidate for Manchester Withington. The seat became Labour in 1987.

I met Benn a few times and supported him in the 1981 deputy leadership election. This alignment was marked in my book Labour at the Crossroads, published in that year. Therein I again supported the alternative economic strategy. But against Benn himself, I argued in that book that in some sectors of the economy “there is no substitute for competition and a market” (p. 206).

(In his important book on The Labour Party’s Political Thought, Geoffrey Foote quotes me (pp. 320, 347) as a “Bennite”. But because of my explicit acceptance of markets, I was unrepresentative of the Bennite stream of thought.)

Subsequently my opinion of Benn shifted. He was a magnificent speaker, but his writings on socialism are vague and unclear. His use of history is unscholarly and cavalier. He was not a well-read intellectual like Michael Foot.

Tony Benn at a Militant meeting

While Benn’s “alternative economic strategy” accepted markets and a private sector for the present, it seemed to me that he wanted to move eventually toward a socialist economy without any markets at all. It was no accident that Benn and his followers defended the Trotskyist sect Militant when they were pushed out of the party from 1985 to 1992.

In 1984 I published my book on The Democratic Economy, where I set out my view on the importance and complementarity of both markets and planning. My argument was framed in socialist language but therein I distanced myself from Marxism. The book received a critical response from many on both the soft and hard left.

The Labour Coordinating Committee

Margaret Thatcher came to power in 1979. One of Thatcher’s most popular policies was to promote the sale of council-owned housing to the tenants. Labour had opposed this policy. The disastrous 1983 defeat of Labour on a Bennite manifesto prompted a rethink, on this and several other issues.

For some of us, this rethink amounted to more than expedient doctrinal trimming. Encouraging home ownership was really a good idea: why should all property be owned by the rich? But while supporting home ownership, we argued that the government should also build more social housing and enlarge the stock available for rent by low-income families.

But these ideas met stiff resistance in the Labour Party ranks, and not simply from Trotskyist entryists such as Militant. The resistance from Benn and his supporters was substantial and even more enduring. It was clear that old-fashioned socialist ideas still had a tenacious appeal among Labour’s membership.

The Labour Coordinating Committee (LCC) became one of the primary modernising forces within Labour. Its leadership included Hilary Benn, Cherie Blair, Mike Gapes, Peter Hain, Harriet Harman, Kate Hoey (the Brexiteer) and others of enduring fame. I was elected to the LCC executive committee. We worked closely with the new leader Neil Kinnock, and with members of his shadow cabinet, including Robin Cook.

Changing Clause Four

I have detailed elsewhere my LCC attempt to bring about discussion to change Labour’s Clause Four. The version that had been in place since 1918 called for the “common ownership of the means of production, distribution and exchange”. This provided for no exception: all production would be in common ownership and there would be no private sector.

Although some Labour Party thinkers began to entertain the possibility of some private enterprise, many party members remained resolutely in support of widespread common ownership.

Against my efforts, the 1983 AGM of the Labour Coordinating Committee defeated the proposal that Clause Four should be rewritten. This was out of fear of antagonising the Benn wing. Instead, the LCC resolved that Clause Four should be “clarified”.

But a resolution on long-term aims, which I had helped to draft, was passed by a large majority. The resolution called for the Labour Party to draft a new statement of aims, upholding “that socialism involves extended democracy and real equality. Democracy under socialism is extended to industry and the community … and must involve a substantial decentralisation of power.”

There was a commitment to “political pluralism” and to “economic pluralism” involving “a variety of forms of common ownership … and the toleration of a small private sector including self-employed workers and other private firms.” The economy must be dominated by mechanisms of “democratic planning … but also accommodating a market mechanism in some areas.”

But there was strong hostility to these mildly revisionist ideas from within Labour’s ranks at the time, including from Jeremy Corbyn and Tony Benn.

Tony Benn & Jeremy Corbyn

The Guardian newspaper reported the LCC conference with the headline: “Labour breaks taboo on ownership”. For a while, the LCC tried to keep the conversation going on the need to revise Labour’s aims. The LCC held a conference in Liverpool in June 1984 on “The Socialist Vision”. But enthusiasm for this discussion fizzled out. By 1985 the LCC’s revisionist initiative had been kicked into the long grass. My efforts had failed.

But to their credit, Neil Kinnock and his deputy Roy Hattersley saw the need for Labour to modernise its aims. I advised them both for a while. But after 1987 I became less active in the Labour Party. My inactivity was born partly out of frustration that it was so difficult to shift Labour from its congenital hostility to markets and private enterprise.

But after a fourth election defeat in 1992 the party became more pliable. Tony Blair was elected as leader in 1994. Blair successfully changed the wording of Clause Four to endorse a strong private sector, but the dramatic rise of Corbyn in the party since 2015 shows that the old collectivist DNA has endured.

Towards liberalism

In many ways I have always been a liberal, especially in my support for freedom of expression, other human rights and democracy. By the late 1970s I also accepted the importance of markets and private property. But the emphasis in my thinking has shifted further in the last 30 years.

My academic works show a few markers of my political evolution. On page xvi of my 1999 book Economics and Utopia I wrote of my common ground with the US liberal John Dewey and with

“British social liberalism, which stretches from John Stuart Mill through Thomas H. Green to John A. Hobson, John Maynard Keynes and William Beveridge.”

These thinkers still inspire me. But I would now also stress the importance of Thomas Paine. Other heroes include George Orwell and Arthur Koestler.

So by 1999 I was a true liberal, of social-democratic stripe. I had already moved some distance from the ideas in my 1984 book, which had over-stressed the possibilities for large-scale planning and for extensive democratic decision-making in large, complex economies.

But I still believe in judicious state intervention and regulation, and I am still an enthusiast for experiments with worker cooperatives and other forms of worker and community participation. With their lower levels of economic inequality, I see the Nordic countries as good role models for in the rest of the capitalist world.

From leaving Labour to joining the Liberal Democrats

In 2001 I left the Labour Party because of Blair’s energetic support for faith schools, Labour’s inadequate proposal for House of Lords reform and its neglect of the problem of economic inequality. I would have left over the Iraq War. Previously I had sometimes voted tactically for the Liberal Party, when they were second behind the Tories in my constituency. But what was tactical was also in growing part a matter of conviction.

I voted Liberal Democrat in the 1997, 2001, 2005 and 2010 general elections. But I did not approve of the coalition with the Tories. So the Liberal Democrats did not get my vote in 2015.

I re-entered political activity in 2016 after the Brexit referendum. My wife (Vinny Logan) had been a critical but close companion on my long journey since 1980. But unlike me she had always voted Labour. After the Brexit vote she joined the Liberal Democrats and I followed her after a few days. It will be a long hard slog to change British politics for the better, but it is vital that we try.

My wife and I were each brought up in a social culture where the Tories and the Establishment were the enemy, and the Liberals were seen as wishy-washy waverers in the class war. Labour was the only game in town.

It takes a long time to remove these ingrained preconceptions and learn that liberalism is the greatest legacy of the Enlightenment. It is the strongest guardian of both prosperity and freedom. Although Liberals have been in a minority, they are largely responsible for the foundation of the British welfare state. The NHS was originally a Liberal proposal. The Liberal Democrats constitute the most pro-EU party in the UK.

But some Liberal Democrats do not understand that it is the job of government in a recession to increase effective demand, particularly by increasing investment and raising disposable incomes for the poor. But the party is a broad church, and I will argue my corner in favour of Keynesian liberal economic policies.

But Liberal Democrats are not neoliberals, by any reasonable definition of the latter, much-abused term.

I am a radical liberal. I believe in social solidarity with the less-privileged, as well as in individual rights. As Charles Kennedy showed when he was leader, the Liberal Democrats can succeed when they take principled, radical positions on justice, equality and war.

Today, both the Conservatives (now ruled by deceitful nationalists) and Labour (where the rising hard left dominate the timid moderates) are dangerous threats to the liberal and democratic rights and values that in the past we have taken too much for granted. We must now stand up to defend those rights and values, against dogma, ignorance, intolerance, petty nationalism and deceit.

 

20 September 2017

Minor edits – 25 September 2017, 22 October 2017, 10 April 2018.

This book elaborates on some of the political issues raised in this blog:
Published by University of Chicago Press in January 2018 

Bibliography

Foote, Geoffrey (1997) The Labour Party’s Political Thought: A History, 3rd edn. (London: Palgrave).

Hodgson, Geoffrey M. (1975) Trotsky and Fatalistic Marxism (Nottingham: Spokesman).

Hodgson, Geoffrey M. (1977) Socialism and Parliamentary Democracy (Nottingham: Spokesman).

Hodgson, Geoffrey M. (1979) Socialist Economic Strategy (Leeds: Independent Labour Publications).

Hodgson, Geoffrey M. (1981) Labour at the Crossroads: The Political and Economic Challenge to Labour Party in the 1980s (Oxford: Martin Robertson).

Hodgson, Geoffrey M. (1984) The Democratic Economy: A New Look at Planning, Markets and Power (Harmondsworth: Penguin).

Hodgson, Geoffrey M. (1999) Economics and Utopia: Why the Learning Economy is not the End of History (London and New York: Routledge).

Hodgson, Geoffrey M. (2017) Wrong Turnings: How the Left Got Lost (Chicago: University of Chicago Press, forthcoming).

Kornai, János (1965) ‘Mathematical Programming as a Tool of Socialist Economic Planning’, reprinted in Nove, Alec and Nuti, D. M. (eds) (1972) Socialist Economics (Harmondsworth: Penguin), pp. 475-488.

Nove, Alec (1980) ‘The Soviet Economy: Problems and Prospects’, New Left Review, no. 119, January-February, pp. 3-19.

Nove, Alec (1983) The Economics of Feasible Socialism (London: George Allen and Unwin).

Nove, Alec and Nuti, D. M. (eds) (1972) Socialist Economics (Harmondsworth: Penguin).

Posted in Bertrand Russell, Common ownership, Democracy, Jeremy Corbyn, Karl Marx, Khmer Rouge, Labour Party, Left politics, Liberalism, Ludwig von Mises, Mao Zedong, Markets, Nationalization, Private enterprise, Property, Right politics, Socialism, Soviet Union, Tony Benn

September 2nd, 2017 by geoffhodgson1946

 

 

Geoffrey M. Hodgson

 

In terms of basic assumptions, Marxism has more in common with some prominent versions of so-called “neoliberalism” than is generally understood. Obviously, Marxism is opposed to a market economy. But some core ideas by Karl Marx and Frederick Engels are remarkably similar to those of some so-called “neoliberals”. For example, Marx’s definition of property resembles that of Ludwig von Mises.

But the parallels go much further, and are disturbing in their consequences. They concern the independence of the legal system and the nature and legitimation of democracy. They also concern the viability of civil society and the autonomy of personal and social life.

The argument here shows that liberalism – both historically and currently – is very different from some modern versions of “neoliberalism”. This “neoliberalism” is theoretically closer to Karl Marx than to Thomas Paine or John Stuart Mill.

Marxism undermines the autonomy of politics and civil society

The Marxian analysis of capitalism treats law and the state as an expression of class interests, which in turn are grounded on “economic relations”. Hence, for Marx, law and the state “originate in the material conditions of life“. They are part of the “superstructure” built upon the “economic base”.

The Marxist analytical reduction of everything to economics does not stop there. Consider the notion of civil society.

Civil society generally connotes a realm of free, partly self-organising, property-owning citizens, who interact under the rule of the state and its laws. In most accounts it includes private business and markets, but it is not reducible to them. It also embraces many forms of social association (including recreation, religion and philanthropy) that are not driven by business interests.

Thomas Paine

Distinctions between civil society and the state, and between civil society and the narrower world of trade and business, were developed by Enlightenment liberal writers such as Adam Smith, Adam Ferguson, Thomas Paine, Alexis de Tocqueville and others. They are crucial for modern liberal theory.

By contrast, Marx reduced civil society to economic relations, governed by money, greed and self-interest. Marx wrote: “Practical need, egoism, is the principle of civil society … The god of practical need and self-interest is money.Hence Marx concluded that “the anatomy of this civil society … has to be sought in political economy.”

Accordingly, Frederick Engels wrote that under capitalism “the state – the political order – is the subordination, and civil society – the realm of economic relations – the decisive element.” Hence everything became a matter of greed and commerce, to be understood through economic analysis alone.

In its analysis of capitalism, Marxism made the state, law, politics and civil society all analytically subservient to markets and business.

These may be regarded as extreme formulations within Marxism. Certainly there are more sophisticated treatments by Marxists of civil society and the state, not least by Antonio Gramsci. But Marxism is severely impaired by the words of its founders.

The above extracts concern the Marxian analysis of capitalism, not its vision of an ideal society, which of course is strikingly different from that of (neo)liberals. While the Marxian analysis of capitalism undermines the conceptual distinction between civil society and the state – by making them both subservient to economic relations – Marxian politics also dissolves it in practice.

In his early tract On the Jewish Question, Marx argued that civil society and political society should become one and the same. In practice, under socialism, once much of the economy becomes a state bureaucracy. With private association under restriction, the scope of civil society is much diminished.

The conceptual and practical degradation of civil society is but one of the roots of totalitarianism within Marxism. Other sources are discussed elsewhere. The smothering of civil society within the party-state makes opposition more difficult and paves the way to dictatorship – a process witnessed in all Marxist regimes, from Russia to Venezuela.

The reclamation of civil society by Eastern European dissidents

Long before the fall of the Berlin Wall in 1989, underground opposition groups had developed in several Soviet Bloc countries. After the crushing of the Hungarian Uprising in 1956, and after the Soviet invasion of Czechoslovakia in 1968, opposition to the Marxist party-state became most developed in Poland.

Leszek Kolakowski

In 1971 the Polish intellectual Leszek Kołakowski wrote his Theses on Hope and Despair. These were circulated illegally in his home country.

Kołakowski complained that the Soviet-style regime had “monopolistic power” that impelled “the atomization of society and the destruction of all forms of social life not prescribed by the ruling apparat.” He called for a pluralist society with genuine freedom of information, discussion and association.

Subsequently, other Eastern European intellectuals such as Jacques Rupnik called for “the rebirth of civil society”. After the formation of the mass trade union movement Solidarity in Poland in 1980, still more voices were added. The Hungarian Andrew Arato wrote in 1981 of the new dissident wave:

“one point unites them all: the viewpoint of civil society against the state – the desire to institutionalize and preserve the new level of social independence.”

Before its unexpected elevation to political power in 1989, Solidarity saw itself as essentially a movement for the “self-defence” of civil society against totalitarian power.

But while the dissidents drew on Enlightenment and liberal thought, their political philosophy was often underdeveloped. After 1989, many former dissidents became influenced by extreme forms of market libertarianism. But given the parallels – explored below – between this “neoliberalism” and Marxist thought, there was more continuity in their thinking than immediately meets the eye.

Market universalism

To understand the connection between “neoliberalism” and Marxism we need first to address a much broader phenomenon within social science.

There is a widespread tendency to use the language of trade and markets to describe phenomena that are neither traded nor markets. I gave some examples in my Conceptualizing Capitalism book. I here call it market universalism.

Consider the notion of a “market for ideas”, which can be found in the writings of Nobel Laureate Ronald Coase. He did not refer to intellectual property but to conversation and freedom of expression.

Douglass North, another Nobel Laureate, wrote of “political markets”. He was not referring to vote-buying (in countries like India) or political bribery, but to the general process of multi-party competition in a democracy.

In a paper published in 1988, Bruce Benson and Eric Engen envisioned “the legislative process as a market for laws” where interest groups “pay” legislators for laws as “products”.

By minimal criteria, none of these is a market. Rules concerning contracts, enforcement and property rights are lacking.

For example, the ordinary communication or debating of ideas does not involve enforceable contracts. Generally, conversation is not an intentional transfer of property rights.

Similarly, if we vote for a politician or a party that does not typically amount to an enforceable agreement. Competition between politicians or parties for votes or power is not a contest for contracts under any established system of contractual rules.

Likewise, with the supposed “market for laws”, in reality there are rarely any enforceable contracts between interest groups and legislators.

There is a further problem. What would be the system of rules under which these supposed “contracts” between legislators and interest groups are formed and enforced? Hence a “market for laws” would require supra-legal institutions with their own (legal or other) rules. We would need markets for markets-for-laws, or markets for meta-rules.

This reveals a problem of an infinite regress, showing that not everything can be placed on a market. My Conceptualizing Capitalism book gives further reasons why markets cannot be universal. There will always be missing markets.

Market universalism and “neoliberalism”

Although market universalism may be dismissed as the harmless use of metaphor, it contains dangerous policy temptations.

Making everything a market denies the autonomy of law and politics: everything is subsumed within the market zone. All forms of association are regarded as market-like or contractual arrangements. Legal and political relations or rights are reduced to the “economic” facts of possession or control.

The temptation is to downgrade all non-commercial justifications for democracy, law or social life. Everything is forced into the conceptual straitjacket of property and contract, and evaluated in terms of profit and loss.

Previous liberal thinkers had defended rights to private property, other human rights, plus institutions such as democracy. By contrast, market universalism can highlight control over property first, on the grounds that it is the foundation of all other rights and liberties. Property moves from being a necessary but insufficient condition of liberty, to being necessary and sufficient for the same.

This transforms the Enlightenment argument that the government must be legitimated by representative democracy, rather than by tradition or divine rule. The “political market” makes democracy a market, and market-like criteria become the overriding source of legitimation for everything.

Furthermore, democracy may be seen as secondary or expedient, especially when property or markets are perceived as being under threat. By treating democracy as another market, a temptation is to regard markets and property as generally more important or supreme than democracy.

Consequentially, market universalism enables something very different from other forms of liberalism, and it involves a radically modified conceptual foundation. One may be tempted to call it neoliberalism.

This is the label suggested by Philip Mirowski, who addressed what he called the Mont Pèlerin “thought collective”. In a perceptive essay on this influential intellectual movement, which involved Friedrich Hayek, Milton Friedman, Ludwig von Mises and others, Mirowski identified several of its traits including the following:

“Skepticism about the lack of control of democracy is offset by the persistent need to provide a more reliable source of popular legitimacy for the neoliberal market state. Neoliberals seek to transcend the intolerable contradiction by treating politics as if it were a market and promoting an economic theory of democracy.”

Confining the “neoliberal” label to people such as Hayek, Friedman and von Mises would be a suitable way of marking their major differences with other forms of liberalism. But it is doubtful that such precision and restraint can be restored to a term that has become over-applied and highly varied in its usage.

Foundations of anti-democratic authoritarianism

We can now see what Marxists and market universalists have in common. They all look upon capitalism as system where everything is reducible to a market.

For Marxists, this means that civil society is nothing more than the sphere of business and individual greed. In addition, the political and legal spheres are simply reflections of these business interests.

A policy consequence – after the socialist revolution – is to destroy civil society and absorb it into politics and the state. This forms part of the Marxist foundation for totalitarianism.

Of course, for “neoliberals”, markets are always beneficial. But the problem is much more serious than their ever-familiar agoraphilia.

Through notions such as “political markets” and “markets for laws”, market universalist “neoliberals” reduce the state and its legal system to a grand marketplace. The state and law become additional markets alongside others. The policy temptation is the practical marketization of the state and the doctrinal denial of the autonomy of politics.

Once politics and all civil society are seen through the lenses of trade and markets, then the basic elements of property and contract become supreme. Instead of being a necessary but insufficient precondition of liberty, property becomes both necessary and sufficient.

This transforms the Enlightenment argument that the government must be legitimated by representative democracy, rather than by divine rule. The “political market” makes democracy a market, and this becomes the overriding source of legitimation.

Consequently, democracy becomes secondary or expedient, especially when property or markets are perceived as being under threat. By treating democracy as another market, a temptation is to regard markets and property as generally more important or supreme than democracy.

Leading “neoliberals” like von Mises and Hayek have been described as classical liberals. But their views are a departure in important respects from the Enlightenment liberalism of the eighteenth and nineteenth centuries, and from other more recent currents of liberal thinking. In some important respect they are closer to Karl Marx than John Stuart Mill.

Margaret Thatcher and Augusto Pinochet

Their supreme emphasis on property rights explains why some “neoliberals” have dallied with dictators. For example, in a book originally published in 1927, von Mises praised fascism as “an emergency makeshift” that “has, for the moment, saved European civilization”. Hayek was notoriously silent about the human rights violations in Chile under the dictator Pinochet. These fascist or dictatorial regimes were seen by them as saviours of private property.

Conclusion: liberalism is not “neoliberalism”

Despite their opposed policy stances, Marxism and the type of market-universalist “neoliberalism” discussed here have similarities at their theoretical foundations. While Marxism reduces the analysis of civil society and politics to an economistic world dominated by self-seeking egoists, this “neoliberalism” does exactly the same.

Within this version of “neoliberalism”, everything is legitimated by free contract in unfettered markets in all spheres of human interaction, including within the state itself. Like Marxism, it reduces everything to economics.

This entails a radical break from other forms of liberalism, and from all other doctrines that recognise the relative autonomy of the political and legal spheres from the economy and from civil society.

2 September 2017

Minor edits – 8, 10 September 2017

This book elaborates on some of the political issues raised in this blog:

Published by University of Chicago Press in January 2018

 

References

Arato, Andrew and Cohen, Jean (1992) Civil Society and Democratic Theory (Cambridge, MA: MIT Press).

Benson, Bruce L. and Engen, Eric M. (1988) ‘The Market for Laws: An Economic Analysis of Legislation’, Southern Economic Journal, 54(3), January, pp. 732-745.

Caldwell, Bruce J. and Montes, Leonidas (2015) ‘Friedrich Hayek and his Visits to Chile’, Review of Austrian Economics, 28(3), pp. 261-309.

Cohen, Jean (1982) Class and Civil Society: The Limits of Marxian Critical Theory (Oxford, Martin Robertson).

Hodgson, Geoffrey M. (2015) Conceptualizing Capitalism: Institutions, Evolution, Future (Chicago: University of Chicago Press).

Hodgson, Geoffrey M. (2017) Wrong Turnings: How the Left Got Lost (Chicago: University of Chicago Press, forthcoming).

Keane, John (ed.) (1988) Civil Society and the State (London: Verso).

Keane, John (1995) Tom Paine: A Political Life (London: Bloomsbury).

Keane, John (1998) Civil Society: Old Images, New Visions (Cambridge: Polity).

Kumar, Krishan (1993) ‘Civil Society: An Inquiry into the Usefulness of an Historical Term’, British Journal of Sociology, 44(3), September, pp. 375-395.

Mirowski, Philip and Plehwe, Dieter (eds) (2015) The Road from Mont Pèlerin: The Making of the Neoliberal Thought Collective, paperback edition (Cambridge MA: Harvard University Press). (Quote from p. xvii.)

Mises, Ludwig von (1985) Liberalism in the Classic Tradition. Translated from the German edition of 1927 (Irvington, NY: Foundation for Economic Education).

Polan, Anthony J. (1984) Lenin and the End of Politics (London: Methuen).

Venugopal, Rajesh (2015) ‘Neoliberalism as a Concept’, Economy and Society, 44(2), pp. 165-87. http://www.tandfonline.com/doi/abs/10.1080/03085147.2015.1013356.

 

Posted in Common ownership, Democracy, Karl Marx, Left politics, Leszek Kolakowski, Liberalism, Ludwig von Mises, Markets, Neoliberalism, Politics, Private enterprise, Property, Right politics, Socialism, Soviet Union, Venezuela

May 21st, 2017 by geoffhodgson1946

 

Geoffrey M. Hodgson

 

Although the two biggest UK political parties are very different in important respects, Labour under Jeremy Corbyn and the Conservatives under Theresa May have each converged on different forms of pro-Brexit, economic nationalism.

Economic nationalism prioritises national and statist solutions to economic problems. Although it does not shun them completely, it places less stress on global markets, international cooperation and the international mobility of capital or labour. It believes that the solutions to major economic, political and social problems lie within the competence of the national state.

Other countries have turned in the same direction, including the United States under Donald Trump and Russia under Vladimir Putin. Previously, both Soviet-style and fascist economies have embraced economic nationalism. China has continued along this road, even after its acceptance of private enterprise and a market economy.

Economic nationalism has been used successfully as a tool of economic development, by creating a state apparatus to build an institutional infrastructure and mobilise resources. But it brings severe dangers as well as some advantages. Its reliance on nationalist rhetoric can feed intolerance, racism and extremism.

Furthermore, as it concentrates economic and political power in the hands of the state, economic nationalism undermines vital checks and balances in the politico-economic architecture.

As numerous social scientists (from Barrington Moore to Douglass North) have shown, democracy and human rights cannot be safeguarded without a separation of powers, backed by powerful countervailing politico-economic forces that keep the state in check.

From Thatcherism to Mayhem: Tory economic nationalism

Margaret Thatcher

In the 1970s, Margaret Thatcher changed the Tory party from a paternalist party of the elite to a more radical, free-market and individualist force, embracing the ideologies of Friedrich Hayek and Milton Friedman.

A logical consequence of this market fundamentalism was to embrace the European Single Market, which her successor John Major did in the Maastricht Treaty of 1992. But this was too much for the Tory nationalists, who were already turning against the European Union and all its works.

The tension grew within the Tories between those that pursued international markets in the name of market fundamentalism, and those who worried that global trade and the free movement of labour were undermining the powers of the British nation state.

A compromise option – widely touted during the June 2016 EU referendum – was to exit the EU but remain in the single market. But a major implication of this was that the free movement of labour to and from the EU would have to be retained. May became prime minister and declared that Britain would leave the single market as well as the EU.

This marks a major ideological shift within the Conservative Party. The pursuit of free markets, promoted so zealously by Thatcher, has moved down the Tory agenda, in favour of nationalism, increased state control, reduced parliamentary scrutiny, and lower immigration, whatever the economic costs.

Forward together: the new-old Toryism

This shift is signalled by a remarkable passage in the 2017 Conservative general election manifesto:

“We do not believe in untrammelled free markets. We reject the cult of selfish individualism.”

This could be interpreted as a cynical attempt to attract some Labour voters. Probably, in part, it is. But there is much more to it than that. It shows how all the whingeing about “neoliberalism” is now outdated and much off the mark.

Crucially, the Tory Party was traditionally opposed to “untrammelled free markets” and it worried about the destructive and corrosive effects of individualism and greed.

As Karl Polanyi pointed out in his classic book on The Great Transformation, the first fighters for factory and employment legislation, to protect workers from the results of reckless industrialization in the 1830s and 1840s, were from the ranks of the church and the Tory Party:

“The Ten Hours Bill of 1847, which Karl Marx hailed as the first victory of socialism, was the work of enlightened reactionaries.”1

Benjamin Disraeli

Tories like Anthony Ashley-Cooper, the Seventh Earl of Shaftesbury, were great nineteenth-century social reformers. The Tory Prime Minister Benjamin Disraeli railed against selfish individualism, particularly in his novels. For Disraeli, British imperialism was more important than unalloyed individualism.

May has brought the Tory party back to its pre-Thatcher roots. But, less enlightened than Shaftesbury or Disraeli, she has little appetite for protective legislation or constitutional reform. Instead, she celebrates her own powers of leadership and seeks a mandate to concentrate power in her hands.

She has little enthusiasm for democracy either. If it were not for the heroic efforts of Gina Miller and the decision of the Supreme Court, the triggering of Article 50 – to start the process of leaving the European Union – would have been taken by the executive without a parliamentary vote.

May and her ministers propose in the Great Repeal Bill to further circumvent parliamentary scrutiny over the details of legislation that must replace adopted elements of EU law.

The 2017 Tory manifesto is a maypole for nationalism. “Britain” is one of its most-used words. It says that immigration will be brought down, while existing powers by the British state to read emails and monitor your activity on the web will be increased. She will create an Internet that is controlled by the state. May is developing the infrastructure of an authoritarian nationalist regime.

Bringing the state back in: Labour’s new-old economic nationalism

At least on the surface, there are dramatic differences with Labour’s manifesto, which, for example, contains more measures targeted at the poor and elderly. Labour also gives much more verbal emphasis to human rights and democracy.

But at the core of Labour’s 2017 manifesto is a strong dose of economic nationalism, with Labour’s greatest commitment to public ownership since the “suicide note” manifesto of 1983. There are plans to bring the railways, energy, water and the Royal Mail all back into public ownership.

The 2017 manifesto declares: “Many basic goods and services have been taken out of democratic control through privatization.” But there is little explanation of what “democratic control” would mean under public ownership.

How would it work? Would parliament take decisions on everything? In reality these proposals – whatever their other merits – would enlarge state bureaucracy: there is no explanation how they would extend democracy.

The words “control” or “controls” appear 32 times in the 2017 manifesto. There is insignificant explanation of how “controls” work. The Labour manifesto envisions a concentration of economic power in the hands of the state, notwithstanding its verbal commitment to regional and local, as well as national, public management.

While there are commendable measures to enhance and enlarge an autonomous sector of worker-owned enterprises, there is little recognition of the importance of having a viable and dynamic private sector as well.

Corbyn’s Labour: forward to the past

As May has brought the Tories back to the pre-Thatcher years, Corbyn has brought Labour back to its traditional roots, before the leadership of Tony Blair.

With his 1995 changes to Clause Four of the Labour Party Constitution, Blair brought in an explicit commitment to a dynamic private sector. Labour stood for an economy where “the enterprise of the market and the rigour of competition are joined with the forces of partnership and co-operation”. Corbyn has returned to the spirit of Labour pre-1995 constitution, even if he has not yet changed the wording.

Corbyn has proposed that Britain can be “better off” outside the EU. He argued that EU rules block the kind of state-heavy industrial policy that he favours. But EU countries such as France and Germany already have strong interventionist policies for industrial and infrastructural development. In truth, Corbyn favours repeated doses of statist socialism in one country.

With some Stalinist exceptions in his coterie, Corbyn and his followers are mostly sincere in their commitment to democracy and human rights. But what they do not understand is that their proposed statist concentration of economic power will undermine countervailing politico-economic forces that can help to keep the state leviathan in check.

Jeremy Corbyn and Hugo Chávez

These countervailing and separated powers are vital. Especially in times of hardship or crisis, there will be a temptation by some in power (at the local or national level) to abuse rights and undermine democracy. Every single historical case shows this result.

It has been illustrated clearly by the failed socialist experiments of the twentieth century. Today, in Venezuela, the failure of such socialist ventures is being played out before our eyes.

Attempts “to take control of the economy”, even with measures of decentralization and local power, have led to restrictions on press freedom, arbitrary detentions, abuses of human rights, and even famine.

Forward together: economic nationalists take the helm

Further doses of economic nationalism may be possible in a country as large as the United States. In 2015, exports from the USA amount to about 13 per cent of GDP. Hence economic nationalists in the USA can reduce trade without too much contraction of the economy. It may turn further inwards, cut imports and still survive a loss of exports.

But the UK has become a globally-orientated, open economy, exporting 28 per cent of its GDP in 2015. About 45 per cent of these exports go to the European Union.

By exiting the EU Single Market, and by walking away from EU trade deals with non-EU countries that benefit EU member states, Labour and the Tories would threaten the UK economy with a massive downturn. The British economy would fall off a cliff.

In this crisis, rightist economic nationalists will blame foreigners and immigrants, and leftist economic nationalists will blame the rich.

It will be “the few” – designated by their ethnicity or by their assets – who will get the blame. Their rights will be under threat, as so will the liberties of all of us. Whatever variety is chosen, economic nationalism could severely undermine the viability of democracy in the UK.

 

21 May 2017

Minor edits – 23, 28 May, 29 June

This book elaborates on some of the political issues raised in this blog:

Wrong Turnings: How the Left Got Lost

Published by University of Chicago Press in January 2018

 

 

Endnote

1. Polanyi was right about this and about several other things, but in other respects his analysis was flawed.

 

Bibliography

Hodgson, Geoffrey M. (2015) Conceptualizing Capitalism: Institutions, Evolution, Future (Chicago: University of Chicago Press).

Hodgson, Geoffrey M. (2017) Wrong Turnings: How the Left Got Lost (Chicago: University of Chicago Press, forthcoming).

Moore, Barrington, Jr (1966) Social Origins of Dictatorship and Democracy: Lord and Peasant in the Making of the Modern World (London: Allen Lane).

North, Douglass C., Wallis, John Joseph and Weingast, Barry R. (2009) Violence and Social Orders: A Conceptual Framework for Interpreting Recorded Human History (Cambridge and New York: Cambridge University Press).

Polanyi, Karl (1944) The Great Transformation: The Political and Economic Origins of Our Time (New York: Rinehart). See esp. pp. 165-66.

 

Posted in Brexit, Common ownership, Democracy, Donald Trump, Immigration, Jeremy Corbyn, Labour Party, Left politics, Liberalism, Markets, Nationalization, Politics, Populism, Private enterprise, Property, Right politics, Tony Blair, Tony Blair, Uncategorized, Venezuela

April 28th, 2017 by geoffhodgson1946

 

Geoffrey M. Hodgson

 

In the May 2017 run-off between Emmanuel Macron and Marine Le Pen, the defeated first-round candidate Jean-Luc Mélenchon refused to endorse the liberal Macron over the neo-fascist Le Pen. Many of Mélenchon’s leftist supporters did the same, arguing positively for abstention.

Jean-Luc Mélenchon

The abstainers argued widely that Macron is a “neoliberal” and the voters faced a choice between the dictatorship of the market or a fascist president.

Some went further: Marron was a “neoliberal fascist” and there was no reason to favour one “fascist” over the other.

This failure to perceive any advantage of a pro-market liberal over the racist and neo-fascist authoritarian nationalism of Le Pen’s National Front, is a symptom of a deep ideological sickness that has endured for decades on the French Left.

The political degeneration of the French Left, which even exceeds that of its Corbynista counterpart in Britain, would be the subject of another blog. My purpose here is to focus on the abuse of the term “neoliberalism” and how this corrupted and overly-widened word has poisoned political discourse.

I also wish to show how some “neoliberals”, who do not include Macron, and whom I shall attempt to characterise more precisely than the n-word will allow, do indeed have connections with genuine fascism.

After the erosion of credibility in classical socialism, particularly after its failed experiments in the twentieth century, it must be understood that our sole alternative to the rising nationalisms of Le Pen, Trump, Putin, Xi, Erdoğan and others is a modern and democratic version of liberalism. Whatever his flaws, Macron fits into the latter category.

The degeneration of the “neoliberalism” label

The widespread use of the word “neoliberal” to describe anyone accepting a significant role for private property or markets has made the word so imprecise that it has become useless and beyond reform.

Even the foremost historians of “the neoliberal project” have acknowledged the problem. Philip Mirowski and Dieter Plehwe wrote:

“We can sympathize with the impatience for those who use the term ‘neoliberalism’ as a blanket swearword for everything they despise, or a brainless synonym for modern capitalism.”

Colin Talbot pointed out that “neoliberalism” has become “a term of abuse” to be used against “any type of pro-market reform or political position that recognizes markets may – in the right circumstances – be a good thing”. Consequently, everyone “from moderate social democrats to the most lurid free-marketeers gets lumped together under a convenient ‘neoliberal’ label.”

In a superb survey of its usage since the 1980s, Rajesh Venugopal concluded that “neoliberalism has become a deeply problematic and incoherent term that has multiple and contradictory meanings, and thus has diminished analytical value.”

Some may wish to retain the “neoliberal” label, to apply it to those free marketeers who attempt to shrink radically the size of the state, to privatise anything that walks, advocate economic austerity and deregulate the financial sector. This would certainly separate neoliberalism from the genuine liberalism of John A. Hobson, William Beveridge or John Maynard Keynes.

But I think that things are too far gone to allow any useful redefinition of the “neoliberal” label to succeed. It is perhaps best abandoned. Instead I wish to focus on a particular strain of so-called “neoliberalism”. This allows us to concentrate on some key issues.

Ludwig von Mises and fascism

Ludwig von Mises (1881-1973) and Friedrich Hayek (1899-1992) were key figures in the so-called Austrian school of economics. Among their major achievements were their contributions to the “socialist calculation debate” where they showed the practical and epistemic limitations of any system of national planning based on comprehensive public ownership.

Ludwig von Mises

While sharing with liberals the support for a market economy based on private ownership, von Mises and Hayek departed from both classical liberalism (of John Stuart Mill, for example) and from twentieth-century liberalism (of John A. Hobson, John Dewey and John Maynard Keynes, for example), in some important respects.

In a book originally published in 1927, Ludwig von Mises praised fascism as “an emergency makeshift” that “has, for the moment, saved European civilization”. This statement cannot be excused, despite the facts that it was in a book that was otherwise devoted to the promotion of classical liberal values, and that von Mises was a Jew who eventually had to flee the Nazis.

From 1932 to 1934 von Mises continued as an economic adviser in Austria, even to the “Austro-fascist” or “clerical fascist” government of Chancellor Engelbert Dollfuss, who assumed dictatorial powers, closed down parliament, smashed the trade unions, and banned several political parties. This does not mean that von Mises was a fascist, but other economists would have drawn the line at advising them.

Friedrich Hayek and the dictatorship of Augusto Pinochet

Friedrich Hayek

The idea that temporary dictatorships, even if murderous, might sometimes be necessary rubbed off onto von Mises’ student, Friedrich Hayek. Hayek argued that democracy, while desirable, can be temporarily dispensable, particularly in defence of private property.

Augusto Pinochet may have saved private property rights in Chile. But he imposed a vicious dictatorship that tortured an estimated thirty thousand civilians and murdered over three thousand.

The right to life, and freedom from torture, are existentially more basic, and hence even more important, than the right to property. Hayek visited Pinochet’s Chile and he failed to condemn these atrocious abuses of human rights. Hayek’s silence over abuses of basic human rights cannot be excused by his age: he was still publishing major books in the 1970s.

The twentieth century teaches us that Marxist socialism crushes human rights and leads to dictatorship. While opposing Communism, von Mises and Hayek (temporarily) tolerated some dictatorships and their removal of some basic human rights, including the rights of habeas corpus and to live without torture.

While earlier liberals had emphasized human rights, private property rights and democracy, in their reaction against socialism, von Mises and Hayek seemed to elevate private property rights over everything else. But private property rights require the protection of all actual or potential owners from torture or extermination. Basic human rights and democracy are vital, as well as the right to private property.

The Mont Pèlerin Society

The ideas of Mises and Hayek were prominent in the Mont Pèlerin Society, founded in Switzerland in 1947. The society accommodated a variety of views, including mainstream liberals plus some members who had collaborated with Nazism in the 1933-1945 period.

The Mont Pèlerin Society was dominated by economists. No less than eight winners of the Nobel Prize in economics have been its members.

The influence of economists is evident in the draft statement of aims of the Society. It opened with these words:

“Individual freedom can be preserved only in a society in which an effective competitive market is the main agency for the direction of economic activity. Only the decentralization of control through private property in the means of production can prevent those concentrations of power which threaten individual freedom.”

Agoraphobics (i.e. fearers of markets) such as George Monbiot and Naomi Klein will probably disagree, but there is a vital truth in this quotation.

The trouble is that it is also a half-truth. Private property and markets are necessary but insufficient to guarantee liberty, as countless market-based totalitarian regimes, from Putin’s Russia to Pinochet’s Chile, will testify. The Mont Pèlerin statement should have made this clear. Instead it gave licence to a view that only private property and markets matter.

Margaret Thatcher and Augusto Pinochet

Hence Mont Pèlerin fans, including UK Prime Minister Margaret Thatcher and US President Ronald Reagan, supported dictatorships and opposed sanctions against South African Apartheid.

In 1999, Thatcher even thanked the former dictator Pinochet for “bringing democracy to Chile”. Clearly, while addressing someone who in 1973 overthrew a democratically-elected government, she invested the term “democracy” with an esoteric, Thatcherite meaning. In truth, Pinochet was a torturer and an assassin.

Vital differences between liberalism and Mont Pèlerin neoliberalism

Even with this brief account we can see some wide, clear water between mainstream liberals such as Macron and Mont Pèlerin “neoliberals” such as Hayek. Unlike those “neoliberals”, modern liberals uphold the following five points:

  1. While markets and private property are essential, they are not sufficient to guarantee human rights and liberty. Vigilance and debate, within a democratic system with a free press, are necessary as well.

  2. Dictatorships, would-be dictators and all abuses of human rights must all be condemned, in market-based as well as in centrally-planned societies.

  3. The capitalist system contains forces that, if unchecked, will lead to greater inequalities of wealth and income. This problem cannot be remedied by simply making markets more competitive. The solution must involve some redistributive taxation and some economic intervention by the state.

  4. Because the owners of capital and labour do not, and cannot, meet on a level playing field, some legally-limited trade-union activity is warranted, along with reasonable employment rights and other protections.1

  5. While early liberalism was born in an era of small-scale producers, modern industrial capitalism bestows an economic (alongside a moral) need for organized mass education, social security and healthcare, along with regulations and bureaucracies to ensure that markets worked effectively and consumers are protected.

If these liberal principles were understood, along with Macron’s support for them, abstention in the May 2017 French presidential elections would be impossible.

 

28 April 2017

Minor edits 1, 4 May – thanks to Pedra Pereira Hors.

 

My forthcoming book elaborates on some of the political issues raised in this blog:

Wrong Turnings: How the Left Got Lost

To be published by University of Chicago Press in December 2017

 

 

Endnote

  1. Note that Macron (like his Socialist Party predecessor François Hollande) wants to reform the blundering and counter-productive French system of employment law, rather than to abolish all employment rights, which must at least conform to standards within the European Union.

 

References

Caldwell, Bruce J. and Montes, Leonidas (2015) ‘Friedrich Hayek and his Visits to Chile’, Review of Austrian Economics, 28(3), pp. 261-309.

Hodgson, Geoffrey M. (2015) Conceptualizing Capitalism: Institutions, Evolution, Future (Chicago: University of Chicago Press).

Hodgson, Geoffrey M. (2016) ‘Some Limitations of the Socialist Calculation Debate’, Schmollers Jarhbuch, 136, pp. 1-26.

Hodgson, Geoffrey M. (2017) Wrong Turnings: How the Left Got Lost (Chicago: University of Chicago Press, forthcoming).

Mirowski, Philip and Plehwe, Dieter (eds) (2015) The Road from Mont Pèlerin: The Making of the Neoliberal Thought Collective, paperback edition (Cambridge MA: Harvard University Press). (Quote from p. xvii.)

Mises, Ludwig von (1985) Liberalism in the Classic Tradition. Translated by Ralph Raico from the German edition of 1927 (Irvington, NY: Foundation for Economic Education). (See pages 47 and 51.)

Venugopal, Rajesh (2015) ‘Neoliberalism as a Concept’, Economy and Society, 44(2), pp. 165-87. http://www.tandfonline.com/doi/abs/10.1080/03085147.2015.1013356.

Posted in Democracy, George Monbiot, Karl Marx, Left politics, Liberalism, Ludwig von Mises, Markets, Naomi Klein, Politics, Private enterprise, Property, Right politics, Socialism

January 28th, 2017 by geoffhodgson1946

 

 

Geoffrey M. Hodgson

 

The political earthquakes of 2016 are probably the beginning of a series of major ruptures in world politics. Donald Trump was elected in the USA, Britons voted for Brexit, Turkey lurched toward dictatorship, Brazil ejected a democratically-elected president, Russia extended its global influence, and China tightened internal security while building military bases in the South China Sea.

From America to Asia, authoritarian nationalism is on the march. The future of old alliances is cast in doubt, raising a renewed spectre of global war.

These seismic changes should prompt us to reconsider our priorities. Is ‘neoliberalism’ – whatever that means – our main enemy? Or is it rising authoritarianism and nationalism instead?

We have been here before, albeit with much less dangerous military weapons. The rival imperialisms of the nineteenth century led to the First World War. Collapsing imperial dynasties triggered revolution in Central and Eastern Europe. Communists successfully seized power in Russia in 1917. Post-war political and economic turbulence led to the triumph of fascism in Italy, Germany and Spain. Imperial Japan invaded nationalist China.

I am not suggesting that history will repeat itself in the same way. But it is important to understand how the tectonic plates of political change affected the way we understand and map political positions, and the way in which we prioritise political issues.

The thirty-year squeeze (1918-1948)

Europe suffered economic depression for much of the interwar period. The financial crash of 1929 exacerbated the crisis and led to a collapse of world trade. Liberal defenders of the market economy were put on the defensive: capitalism seemed at the end of its tether.

Beatrice & Sidney Webb

Meanwhile, some intellectuals from the USA and Britain – including Labour stalwarts George Bernard Shaw and Sidney and Beatrice Webb – visited the Soviet Union brought back glowing accounts of an expanding economy and a joyful population. (The Soviet propagandists explained away disasters such as the Ukranian Famine as resulting from sabotage by rich peasants or foreign agents.)

With the crisis of capitalism, the rise of fascism and the apparent success of Soviet Russia, many British and American radicals became Communists or fellow travellers. For them, liberalism and the defence of the market economy seemed a weak or unviable option.

The choice seemed to be between two forms of authoritarian government: much better the one that proclaimed equality and opposed racism. (But in reality, the Stalin regime promoted antisemitism, genocide against several other ethnic minorities, and dramatic internal inequalities of power.)

Stalin, Roosevelt and Churchill in 1941

The alliance between Russia and the West in the Second World War smothered criticism of what was really going on within Stalin’s regime. But, with the beginning of the Cold War in 1948, socialists were forced to make a choice between either supporting an antagonistic and undemocratic foreign power, or aligning with the USA and its allied democracies.

Labour under Clement Attlee aligned with the West. But rose-tinted visions of Soviet Russia or (from 1949) Mao’s China lived on among he Left.

In major European democracies, the thirty years between the end of the First World War and the start of the Cold War had seen liberalism squeezed, between socialism on the one hand, and reactionary authoritarianism on the other.

‘American imperialism’ and the rise of neoliberalism

Things were different in the USA, which polarised between forms of Republican conservatism and Democratic liberalism. But rising tensions in the Cold War, and the eruption of the Vietnam War in the 1960s, made American-style liberalism less attractive for the global Left.

Marxist-led national liberation movements in Cuba, Indochina and elsewhere kept the collectivist vision alive for the Left around the world. Liberalism was see as the fake ideology of American imperialism and the global bourgeoisie.

Some have argued that neoliberalism was reborn in the 1970s, when conservatives such as Ronald Reagan and Margaret Thatcher adopted a vision of expanding markets and a contracting state. Although the Left could never agree on what ‘neoliberalism’ meant, they mostly agreed that it was the main enemy.

Much of the Left, throughout the world, had never got rid of its agoraphobia – its fear of markets. Private enterprise and market forces were always and everywhere seen as the problem. Liberals, who defended private property and markets as well as human rights, were mocked as the bourgeois enemy.

Our brave new world

But the global tectonic plates are now shifting abruptly, in an erupting national and international crisis, as big as anything since 1948.

Nationalist leaders strut around the world stage. They stock up their nuclear and conventional arsenals and jostle for geopolitical advantage.

Torture is endorsed. Journalists are threatened or imprisoned. Scientific findings on climate change are denied. Intellectuals and experts are ridiculed. Ignorance and dogma are celebrated. Truth is swamped by lies. Legislation protecting workers and the poor is undone. Minorities are attacked and made scapegoats. Racism is given licence. People suffer discrimination on the basis of their religious or other beliefs. Democratic systems are damaged. Judges and lawyers are treated as traitors. The rule of law is undermined.

In this dangerous new world, it matters less whether that railway is nationalised or whether water distribution is in public ownership. Forms of ownership are always secondary to the actual provision and distribution of vital goods and services. But when our rights and liberties can no longer be taken for granted, questions over forms of ownership move even further down the ranking of priorities.

The ubiquitous, trivialising idea that the Left is defined in terms of public provision, and Right as private provision, is historically recent and a gross reversal of their original meanings. It is also a polarisation of lesser relevance in this world of rising authoritarian nationalism.

Our fundamental rights, our liberty, and the rule of law are now increasingly threatened. Their defence becomes the great struggle of our time.

This lesson is hardest for Americans and Britons, who were spared domestically from the jackboots of twentieth-century despotism. Struggles for British and American national liberty are beyond living memory. We have grown fat and lazy on the fruits of the liberal order. We have taken for granted its institutions and underestimated their fragility. We must repair our vigilance.

The liberal opportunity

For 100 years, for the reasons given above, liberalism has been marginalised. Now is its opportunity – indeed its urgent necessity.

Unlike our grandparents in the crisis-ridden 1930s, we have seen the socialist experiments of the twentieth century and counted their cost at 90 million lives. History and social science have more to teach us. If we wish to learn, we can know more about how markets work. We can understand the informational, organisational and other impediments to comprehensive national planning. We can appreciate why countervailing politico-economic power, based on a strong private sector, are necessary to buttress democracy and resist authoritarianism. The twentieth century has taught us these lessons.

Except in the closed minds of Marxists, classical socialism and national collectivism are no longer serious options. They are impossible fantasies, especially irresponsible in the face of rising authoritarian nationalism.

The old Marxist mantra of bourgeoisie versus proletariat is also ungrounded in reality. Instead we have a highly fragmented working class, much of it enduringly aligned with authoritarianism and nationalism. Marxism relies on a quasi-religious and nonsensical belief that the working class – whatever it actually believes or strives for – carries our human destiny.

Class struggle has mattered, but it has never been the main motor of history. What have mattered more have been struggles for power, by individuals, dynasties, nations, religions or ideological movements.

The Storming of the Bastille in 1789

Liberalism was one of those movements. Based on the imperatives of equality and liberty, it matured in the Enlightenment.

Liberalism rose up in the English Civil War of the 1640s, in the American Revolution of the 1770s, and in the French Revolution of 1789, in titanic struggles against despotism and oppression.

Now, once again, liberalism is centre stage, as the enemy of authoritarian nationalism.

The liberal rainbow

Its allies are not those who pander to authoritarianism by eroding civil liberties, or do the spadework of the nationalist Right by making immigration (rather than assimilation) a foremost problem. The prime allies of liberalism are all those who defend liberty and human rights. But therein lies a concern, which must be discussed.

From the beginning, liberalism has harboured different views on the role of the state and of the degree of state intervention required in the economy and society. On the one hand there are liberals – sometimes called libertarians – who wish to minimise the role of the state.

Thomas Paine

On the other hand, alongside this, is a different strain of liberalism – involving Thomas Paine, John A. Hobson and others – that places greater stress on social solidarity, economic redistribution and welfare provision. Paine in particular saw the need for a major redistribution of wealth. Involving key figures such as David Lloyd George and William Beveridge, this strain of liberalism was central to the development of the British welfare state.

John Maynard Keynes – another great liberal – argued that state regulation of financial markets and counter-cyclical expenditures are necessary to stabilise the capitalist system. Keynes showed that economic austerity is a flawed doctrine. Government deficits are best reduced by growth: budget cuts can contract the entire economy and make the problem worse.

There is a spectrum of views between individualist and social-democratic liberalism, but all liberals are united in their defence of individual liberty, human rights and political democracy. The diverse colouring of this rainbow does not diminish its united opposition to the dark intolerance and division that is exacerbated by authoritarian nationalism.

The struggle for liberty and equality has always been vital. But many twentieth-century radicals were diverted by the delusions of socialism. The renewed rise of authoritarianism has shown us again that liberalism is the vital political movement of the modern age.

 

28 January 2017

Minor edits: 29 January, 1, 16 May 2017

 

This book by G. M. Hodgson elaborates on some of the political issues raised in this blog:

Wrong Turnings: How the Left Got Lost

Published by University of Chicago Press in January 2018

 

Bibliography

Allett, John (1981) New Liberalism: The Political Economy of J. A. Hobson (Toronto: University of Toronto Press).

Beveridge, William (1944) Full Employment in a Free Society (London: Constable).

Clarke, Peter (1978) Liberals and Social Democrats (Cambridge: Cambridge University Press).

Claeys, Gregory (1989) Thomas Paine: Social and Political Thought (London and New York: Routledge).

Courtois, Stéphane, Werth, Nicolas, Panné, Jean-Louis, Packowski, Andrzej, Bartošek, and Margolin, Jean-Louis (1999) The Black Book of Communism: Crimes, Terror, Repression (Cambridge MA: Harvard University Press).

Hodgson, Geoffrey M. (2015) Conceptualizing Capitalism: Institutions, Evolution, Future (Chicago: University of Chicago Press).

Hodgson, Geoffrey M. (2017) Wrong Turnings: How the Left Got Lost (Chicago: University of Chicago Press, forthcoming).

Keane, John (1995) Tom Paine: A Political Life (London: Bloomsbury).

Keynes, John Maynard (1936) The General Theory of Employment, Interest and Money (London: Macmillan).

McCloskey, Deirdre Nansen (2017) ‘Nationalism and Socialism Are Very Bad Ideas: But liberalism is a good one’, Reason.Com, February. http://reason.com/archives/2017/01/26/three-big-ideas

Monbiot, George (2016) ‘Neoliberalism – the ideology at the root of all our problems’, The Guardian, 15 April. https://www.theguardian.com/books/2016/apr/15/neoliberalism-ideology-problem-george-monbiot.

Townshend, Jules (1990) J. A. Hobson (Manchester: Manchester University Press).

Venugopal, Rajesh (2015) ‘Neoliberalism as a Concept’, Economy and Society, 44(2), pp. 165-87. http://www.tandfonline.com/doi/abs/10.1080/03085147.2015.1013356.

Posted in Brexit, Common ownership, Democracy, Donald Trump, Immigration, Karl Marx, Labour Party, Left politics, Liberalism, Markets, Nationalization, Politics, Populism, Private enterprise, Right politics, Socialism

December 6th, 2016 by geoffhodgson1946

migrants4

Geoffrey M. Hodgson

 

Racist nationalism has returned from the fringes to mainstream politics. In 2016 it played a major role in the Brexit vote in the UK, in the election of Donald Trump in the US, in the presidential election in Austria, and in developments in many other countries.

Racism and other forms of discrimination, including by gender or belief, must be defeated. The Left has played a major role in countering racism, and it should be give due credit for that. But in some other respects the Left on this issue is weak and misguided.

Some things we cannot talk about – but we must

Some things have become difficult to discuss. I once tweeted the (obviously true) statement that “Islam is religion, not a race”. A fellow tweeter immediately assumed that I was some kind of bigot and responded “ugh!”

In this reactive climate it has become difficult to raise concerns about (say) Sharia law without being branded racist or right-wing. Discussion ends. But the fact that rightist bigots – such as Nigel Farage and Geert Wilders – go on about Sharia law does not mean that we cannot discuss it.

trump1Of course, Muslims and others suffer significant discrimination, in Britain and elsewhere. In recent months, Trump has been responsible for major anti-Muslim outbursts and has whipped up violent anti-Muslim sentiment in the US.

We must defend the full human rights of everyone, including members of all faiths. But this does not mean that we must refrain from criticising religious doctrines.

On the contrary, our failure to discuss these issues has favoured conservatives over reformers within these religions, has allowed religious extremism to ferment, and has repeatedly played into the hands of the reactionary and extremist Right.

I explain here where and how the Left has got things wrong in this area. I concentrate mostly on the moderate Left. The sins of many on the Far Left are much worse, including their support for fanatical, religious, “anti-Imperialist”, extremists in Palestine, Iran and elsewhere.

The election of Trump is a wake-up call. We need to find more effective ways to counter racism and other forms of discrimination. We need to find ways to make multi-religious and multi-ethnic communities more inclusive and cohesive.

Immigration – beyond the numbers game

The recent massive increases of immigration into Europe and elsewhere are a fact. But at least as far as the UK is concerned, it has been shown that the economic benefits of immigration are positive.

labour-immigration1But much of the political debate is about immigrant numbers. The Tories ignore the economic evidence and start a Dutch auction of targets, to stem numbers. A large part of the Labour Party, facing a seepage of its working class support to UKIP, moves in a similar direction.

Of course, mass immigration becomes a problem when there are not enough school places, health services are severely stretched, housing is limited and inadequate, and the transport infrastructure groans from decades of under-investment.

But any cutting-numbers strategy is unlikely to appease opponents of immigration. It would be better to help immigrants to learn English and understand our institutions.

Labour is internally divided between those that want to restrict immigration, and the leadership around Jeremy Corbyn who propose no restrictions at all. With some notable exceptions, what is missing is a discussion prioritising assimilation.

The Casey Review

Louise Casey

Louise Casey

The recently-published, government-commissioned report by Louise Casey suggests that “the tough questions on social integration are being ducked”. Casey and her team found evidence that black and minority ethnic groups are still suffering from discrimination and disadvantage and responses by government and others are inadequate. While she found some evidence of integration, in other areas the outcomes were different:

“In some council wards, as many as 85% of the population come from a single minority background, and most of these high minority concentrations are deprived Pakistani or Bangladeshi heritage communities.”

These concentrated enclaves are more difficult to assimilate and create particular problems for women:

“this sense of retreat and retrenchment can sometimes go hand in hand with deeply regressive religious and cultural practices, especially when it comes to women. These practices are preventing women from playing a full part in society, contrary to our common British values, institutions and indeed, in some cases, our laws. … I’ve met far too many women suffering the effects of misogyny and domestic abuse, women being subjugated by their husbands and extended families. Often, the victims are foreign-born brides brought to Britain via arranged marriages. They have poor English, little education, low confidence, and are reliant on their husbands for their income and immigration status. They don’t know about their rights, or how to access support, and struggle to prepare their children effectively for school.”

Casey argued that fears of being labelled “racist” have prevented society from challenging sexist, misogynistic and patriarchal behaviour in some minority communities. Her report cites claims that some Sharia councils had supported the values of extremists, condoned wife-beating, ignored marital rape and allowed forced marriages.

Her report concluded with a rallying cry:

“The problem has not been a lack of knowledge but a failure of collective, consistent and persistent will to do something about it or give it the priority it deserves at both a national and local level.”

But to “do something about it” requires a clearer understanding of the problems involved and what kind of policies are needed to deal with them. Some people have criticised Casey’s empirical claims and more research is clearly required.

Multiculturalism

As several authors have pointed out, multiculturalism is an ambiguous concept. In one sense, at least, it is unobjectionable. All civilisations have drawn and benefitted from cultural variety. Western countries today benefit enormously from the influx of ideas, skills, fashions, cuisines and experiences that successive waves of immigration have brought. This has been true for millennia. It is no less true today.

Institutions are the stuff of society: institutions are systems of social rules. Some rules – concerning dress and fashion for example – can change profoundly without social collapse.

Other institutions – particularly in law and politics – are the outcomes of centuries of experience, deliberation and experimentation. We cannot put these in a culture-mixing food blender without tearing apart the fabric of society and wrecking social cohesion and solidarity.

Much discourse about multiculturalism ignores these differences in types of rules and institutions. Everything is placed under the vague and overly-capacious category of “culture”, assuming everything can be mixed at will. This soup-making, food-blender approach is dangerous and misconceived.

Cultural relativism

Some parts of the Left have embraced normative cultural relativism. This is the view that one person’s morality is as good as any other. It is said that there is no “objective” or “correct” morality. No overriding importance is given to democracy or to the United Nations Declaration of Universal Human Rights. Other cultures have different codes and priorities: let them be.

According to this view, asking people from other cultures to adopt our over-arching laws and values is seen as a manifestation of “oppression” or “Western imperialism”. We have to be very careful not to jump to the conclusion that Western moral values are superior. But that does not mean that we should reach no judgmental conclusion at all.

Germaine Greer

Germaine Greer

For example, in her 1999 book The Whole Woman, the self-declared “Marxist” and iconic feminist Germaine Greer asked us to refrain from criticising female genital mutilation, on the grounds that it would impose our cultural values on others.

In his excellent book What’s Left? Nick Cohen gives some further examples of highly misguided cultural relativism, including attempts by feminists and leftists to defend the Indian practice of burning widows alive after the deaths of their husbands.

Analytically, this kind of cultural relativism has major flaws. First, it falls down in dealing with changing attitudes through time in one country. A cultural relativist, time travelling back to 1800, could raise no objection to slavery, or to the lack of women’s rights. If one morality is as good as any other, then there can be no moral force for change.

Second, it is internally inconsistent. Cultural relativism denies that our values are valid or suitable for other cultures. Why should this normative claim (that we should not impose our normative values on other cultures) be adopted by others in different cultures? By the logic of cultural relativism, thinkers in other cultures are not obliged to be cultural relativists. The whole argument is self-defeating.

Third, cultural relativism degrades the role of morality, by treating it as a matter of individual preference. The whole point about morality is that it transcends individual preferences. Moral claims (be they right or wrong) are universal. Humans have developed systems of morality to provide us with rules that help social cohesion while simultaneously protecting individual rights and liberties.

Reticence to act – condemnation of action

As well as the benefits of cultural enrichment, mass immigration has also brought problems of assimilation. In the UK there are large communities where many people do not speak English, or remain ignorant of prevailing laws and values that have evolved over centuries to keep our society together and to protect our interests.

Many of these immigrants had limited experience of any Western-style democracy and had an inadequate appreciation of universal human rights. Many came from rural areas in undeveloped countries, where the state was weak and social and business interactions were governed by custom and religion, based on ties of loyalty to family and clan.

Ann Cryer

Ann Cryer

Faced with this issue, many progressive politicians have adopted a stance of ultra-tolerance and inaction. Consider the question of language. Should immigrants be obliged to learn the language of their new country, so that they can understand its culture and its laws? Some other countries take this on board.

But such an assimilationist policy in the UK was highly controversial as late as 2001. In that year, the Labour MP Ann Cryer bravely argued that many Muslims were held back economically and educationally by language difficulties. The problem was especially severe among Muslim women.

But she was faced with criticism and scorn from the Left. Shahid Malik, then a senior member of the Commission for Racial Equality and of the Labour Party National Executive Committee, and subsequently a Labour MP and government minister, responded to Cryer: “Her arguments are sinister and they have no basis in fact … she is doing the work of the extreme right wing.”

Promoting faith schools

Schooling must be central to any viable integration programme. Young people need to learn about the struggles for democracy, independence, rights and human emancipation, throughout the world. They should be free to discuss and evaluate all these things.

Such a broad education is less likely in a school that is linked to one particular religion. Instead it would be more viable in secular schools with pupils from multiple religions, classes and cultures. Broad-based secular education is even more vital in multi-cultural and multi-faith societies.

faith-schoolAfter coming to power in 1997, Labour Prime Minister Tony Blair promoted a programme of expansion of faith schools. But a 2001 report commissioned by Bradford City Council concluded that its communities were becoming increasingly isolated along racial, cultural and religious lines, and that faith-segregated schools were fuelling the divisions.

In 2001 there were riots in Bradford, which spread to other northern cities. Yet in the same year the Labour Government proposed a large increase in the number of state schools run by religious organizations.

By 2002 there was a major public row, with accusations that some pupils were being taught creationism in and that homosexual acts are against God’s law. Campaigners for women’s rights expressed concern that conservative religious teachers were instructing young girls that women should take a secondary role in society.

Despite his previous opposition to Blair, in 2016 the Labour Leader Jeremy Corbyn expressed his support for faith schools. No major UK political party has dared to come out against them. They are being vigorously promoted by the current Conservative government.

Faith schools have hindered assimilation

David Bell

David Bell

David Bell warned in a January 2005 speech to the Hansard Society – when he was Chief Inspector of Schools – that a traditional Islamic education did not equip Muslim children for living in modern Britain. He said: “I worry that many young people are being educated in faith-based schools, with little appreciation of their wider responsibilities and obligations to British society.” He continued:

“We must not allow our recognition of diversity to become apathy in the face of any challenge to our coherence as a nation … I would go further and say that an awareness of our common heritage as British citizens, equal under the law, should enable us to assert with confidence that we are intolerant of intolerance, illiberalism and attitudes and values that demean the place of certain sections of our community, be they women or people living in non-traditional relationships.”

Trevor Phillips

Trevor Phillips

His comments were condemned as “irresponsible” and “derogatory” by some senior Muslims, but supported by Trevor Phillips, then chair of the Commission for Racial Equality.

In another lecture Bell said: “We can choose … whether we want to bring our diversity together in a single rainbow or whether we allow our differences to fester into separate cultures and separate communities.”

Phillips came to the conclusion that increasing self-segregation of British communities along ethnic and religious lines was a major threat to national integration and to Enlightenment values. Young people were being brought up with insufficient awareness of these values, in closed communities where extremism could fester.

David Miliband

David Miliband

Ken Livingstone, then Mayor of London, attacked Phillips for “pandering to the right”. During a televised discussion, the prominent Labour Minister David Miliband shook his head and described Phillips’s remarks about community segregation as “fatuous”.

Since then, Phillips’s concerns about social segregation in British communities have been vindicated by several experts, while other evidence indicates a small amount of progress. Even the most optimistic reading of the evidence suggests a serious and enduring problem.

On faith schools, the Casey report noted their role in institutionalising segregation:

“The Government had attempted to alter the segregation of pupils in faith schools by introducing admissions criteria for new faith-based Free Schools. But these did not seem to be having an impact on the diversity of minority faith schools … [their] admission policies do seem to play a role in reinforcing ethnic concentrations.”

But Casey did not take the final step. She wrote: “ending state support for all faith schools would be disproportionate”. But how serious do the problems have to become before it becomes proportionate?

Rather than relying on failed palliatives, state-funded faith schools should be phased out. Taxpayers should not subsidise religion: religion and the state should part company.

A recent poll found that an overwhelming majority of the British public opposed religious discrimination in faith school admissions. Making all faith schools non-discriminatory in terms of religion would be a big positive step.

Fostering extremism

Ed Husain was born and educated in Britain, where he obtained a Master’s Degree. He was drawn toward extreme versions of Islam and was persuaded that Western democracies are irredeemably corrupt and must be replaced by a theocracies based on Islamic law.

husain-islamistAfter several years he renounced his former extremism, but retained his Islamic faith. In an interview he revealed the segregated life of his upbringing:

“The result of 25 years of multiculturalism has not been multicultural communities. It has been mono-cultural communities. Islamic communities are segregated. Many Muslims want to live apart from mainstream British society; official government policy has helped them do so. I grew up without any white friends. My school was almost entirely Muslim. I had almost no direct experience of ‘British life’ or ‘British institutions’.” (Quoted in Cohen 2007, p. 378.)

British policy-makers have welcomed diversity. But they have defined needs and rights via the ethnic categories into which people were placed, using those divisions to shape public policy. The result has been a more fragmented society, which has nurtured extremism.

In the name of multi-culturalism, Britain has become a more divided society, where inclusive, universal, Enlightenment values are often side-lined or unknown. These communal enclaves, found in France and Belgium as well as Britain, have become hothouses for violent extremism.

Hassan Butt was born in Luton in England in 1980. In 2000 he travelled to Pakistan and worked for the Taliban and other jihadists against the West. Subsequently he renounced his anti-Western views.

Butt explained that “Islamic theology, unlike Christian theology, does not allow for the separation of the state and religion … [they] are considered to be one and the same.” Consequently, since there no righteous Islamic state is deemed to exist, the extremists have “declared war on the whole world”.

stopthewarcoalition2Some on the Far Left disowned Butt for betraying the struggle against “Western imperialism”. He was also criticized by one member of the “Stop the War” movement, who is a leading supporter of the Muslim Brotherhood, for his “call to change the face of Islam” (Cohen 2007, pp. 371-2).

Butt’s response was clear: “I believe that the issue of terrorism can be easily demystified if Muslims and non-Muslims start openly to discuss the ideas that fuel terrorism.” However, many on the Left, as well as the Right, are not helping this process.

British values?

Successive British Prime Ministers have reacted to the threat of Islamist extremism by calling for “British values”. After claims that some schools in Birmingham were promoting Islamist extremism, in 2014 the Conservative Prime Minister David Cameron outlined plans to put the promotion of “British values” at the heart of the national curriculum for schools. This is now official policy:

“Schools should promote the fundamental British values of democracy, the rule of law, individual liberty, and mutual respect and tolerance of those with different faiths and beliefs.”

flag_of_the_united_kingdomBut the official government document outlining this policy mentions respect and tolerance for other races but fails to mention discrimination against women or gays. It rightly mentions the freedom to “choose and hold” any faith, but not the freedom to exit a religion without sanction. It mentions “individual liberty” only once, and fails to uphold freedom of non-violent expression, including when it may cause offence.

Are these omissions an accident, or are they designed not to offend a particular religious minority?

Liberty-Equality-FraternityAnother problem here is not the values as such, but their nationalistic description as “British”. Democracy was not invented in Britain: Ancient Athens and Viking Iceland have much earlier precursors. The US and France have much earlier claims to the values of liberty and religious tolerance. Britain legally discriminated against Protestant nonconformists and Catholics until the nineteenth century, and it still bars any Catholic from becoming its sovereign.

Apart from being misleading and inaccurate, the label of “British values” would hardly be effective in preventing a young Muslim from being radicalised. On the contrary, the label can help bolster the misperception that Britain and the rest of the West are at war against Islam. This nationalistic labelling readily allows the distortion that “British values” are being promoted by the UK authorities in a global effort to counter Islam.

It would be more accurate and effective to label values such as democracy, the rule of law, individual liberty, and freedom of worship as “universal values” or “Enlightenment values”. They are not simply values that British residents and citizens should adopt. Other countries should promote these values too.

Islamophobia?

Polly Toynbee is a leading progressive, and vigilantly anti-racist, British journalist. Yet in 2004 she was proclaimed by the Islamic Human Rights Commission as the winner of their “Most Islamophobic Media Personality” award.

Polly Toynbee

Polly Toynbee

In her words, she received this ridiculous appellation because she “had challenged the legitimacy of the idea of Islamophobia and warned of the danger to free speech of trying to make criticism of a religion a crime akin to racism.” She rightly noted that the “occasional note of reason from moderate Islamic groups is so weak it hardly makes itself heard”. She highlighted the difficulties involved in starting a serious dialogue on this issue.

The failure to distinguish racism from criticism of religion sadly remains widespread. Many on the Left have done excellent work since the 1970s in campaigning against racism, fascism and discrimination. But the frequent confusion of criticism of religion with racism has diverted their efforts.

It must be repeated that concerns about Islam as a belief system are not equivalent to bigotry toward Muslims. Racism and persecution of Muslims are serious problems and should be vigilantly opposed. But the option to criticise Islam, or any other belief system, is an important right, and it should be protected.

The term “Islamophobia” is partly to blame. Despite widespread usage, it is rarely defined and there is no consensus on its definition.

Does it literally mean fear of Islam? Or criticism of Islam? Or hatred of Islam? Or persecution of Muslims? Its intended meaning can range from scholarly criticism of Islamic doctrines to racist acts against ethnic groups who are Muslim. These are obviously very different. Yet they are all lumped together under the same label.

“Anti-Muslim prejudice” or “anti-Muslim discrimination” would be much better terms. They accurately describe this very real and sadly widespread problem.

Criticism of religion can be enlightening – indeed a part of Enlightenment (and British) values, from Voltaire to Bertrand Russell. We should also be free to criticise Sharia law, as we are free to criticise other laws.

Justin Welby

Justin Welby

As Archbishop of Canterbury Justin Welby pointed out recently, there also needs to be a discussion about the doctrinal links between religion and extremism:

“This requires a move away from the argument that has become increasingly popular, which is to say that ISIS is nothing to do with Islam, or that Christian militia in the Central African Republic are nothing to do with Christianity, or Hindu nationalist persecution of Christians in South India is nothing to do with Hinduism.”

Extreme and draconian statements can be found in the Old Testament of the Bible as well as in the Qur’an. Believing that they are obeying the word of God, these texts have spurred violent religious extremists, as we are all sadly aware.

Nevertheless, many modern Christians, Jews and Muslims have accepted the power of state law over religious law. They obey the laws of their country. They do not kill homosexuals (Leviticus 20:13), or slay apostates (Deuteronomy 13:6-10), or stone to death a bride who is not a virgin (Deuteronomy 22:20-21), or rape non-Muslim women (Qur’an 23:1-6, 70:22-30), or make war on unbelievers (Qur’an 8:12, 9:5, 9:73, 9:123).

We must help this vital transition from regressive religious law, toward a recognition of modern secular law and democracy. But we do not do so by pretending it is not needed, or refusing to discuss it, or branding those that discuss it as “Islamophobic”.

Signs of hope

On a more positive note, the authors of the 2007 Policy Exchange Report argued for a change of approach. The government and others “should stop emphasising difference and engage with Muslims as citizens”.

Policies of “group rights or representation” for specific Islamic communities are likely to alienate other sections of the Muslim population further. These well-informed remarks went against much of the then-current local and national government policy.

The authors continued: “The exaggeration of Islamophobia does not make Muslims feel protected but instead reinforces feelings of victimisation and alienation.” They also called for “a broader intellectual debate in order to challenge the crude anti-Western, anti-British ideas that dominate cultural and intellectual life. This means allowing free speech and debate, even when it causes offence to some minority groups.”

We need to be honest. Extremist religions of all kinds can threaten liberal, democratic and Enlightenment values. Christianity in particular has been violently repressive and brutal. Some religious sects today are fanatical and intolerant.

These issues need to be openly discussed, in a civilised manner. They should not be swept under the carpet by those on the Regressive Left who act as if they do not understand the difference between race and religion, or would shut down critical discussion of a religion because it might be wrongly construed by others as an attack on a minority, or by other politicians of any stripe who are simply too scared to take the issue on.

But there are signs of hope. Many Muslims are engaged in open discussions about the possible reform of Islam, on the measures needed to integrate their communities into Western society, and on the best means to de-radicalise young Islamic extremists. The statements of many Muslim leaders who have strongly condemned Islamist terrorism should also be welcomed.

In an immensely positive development, the “Muslim Reform Movement” was launched in 2015. In their inaugural statement they defended freedom of speech, gender equality, a secular state and the UN Declaration of Universal Human Rights. They noted explicitly that freedom of speech included the right to criticize Islam: “Ideas do not have rights. Human beings have rights.”

By contrast, the blanket and ill-defined leftist rhetoric of “Islamophobia” does not help those Muslims who are struggling to reform and modernise their religion. Instead, the more conservative leaders of Muslim communities protect their regressive and reactionary views behind its smokescreen. Modernising Muslims are thus impaired by an unwitting coalition of leftists and Muslim conservatives.

Responsibility lies on both sides. In a climate of open discussion, we all need to be vigilant against acts of hatred or violence against Muslims and other minorities.

Initiatives to preserve liberal values in a multi-faith and multi-ethnic world should be welcomed. In addition, the Left needs to re-establish its links with the Enlightenment and its project to separate church from state. Within any society, freedom of worship should be protected, as well as the freedom to criticise religion.

Inward-looking, unreforming, dogmatic religion is a major barrier to assimilation. The Left needs to learn that lesson, and to encourage open discussion of the issues involved.

 

islam3

6 December 2016

Edited 7th and 10th December 2016, with thanks to Andrew Ross.  Further edit, 23 January 2017.

 

My forthcoming book elaborates on some of the political issues raised in this blog:

Wrong Turnings: How the Left Got Lost

To be published by University of Chicago Press in November 2017

 

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