Hawks, Hayek and Hubris

by Lee McCracken

F.A. Hayek is one of those figures who appeals to both libertarians and conservatives. Libertarians rally to his defense of the free market, his love of liberty, and his opposition to totalitarianism in all its forms. Conservatives appreciate his praise of organic, incremental change, and his Burkean emphasis on the results of trial and error embodied in a tradition. All of which makes it strange to see so many self-proclaimed libertarians and conservatives ignoring some of Hayek’s central insights when they talk about the war on terrorism and the prospective attack on Iraq.  

One of Hayek’s most important themes (common to the Austrian school as a whole) was the futility of central planning. He set his face against many of the intellectual trends of the 20^th century in denouncing fascism, communism, and western-style welfare statism. It was widely believed (and still is, in some quarters) that intellectuals and technicians equipped with knowledge (and power) could recreate society along more rational, equitable, and just lines.  

Hayek responded that central planning would inevitably result in slavery and poverty. This is because no central agency, such as a government, can possibly posses all the information needed to make decisions affecting the entire economy. The reason free markets function without being guided from above is that knowledge is dispersed among millions of actors in any complex system like a market. This lack of knowledge would inevitably lead government planners to pursue policies that had unforeseen and unintended consequences. As these consequences became apparent, there would be calls for more intervention, the people not realizing that it was the original intervention that caused the problems in the first place. Intervention upon intervention would follow, until western liberal societies were turned into mirror images of their totalitarian adversaries.  

In Law, Legislation, and Liberty , Hayek writes:

“What we must ask the reader to keep constantly in mind . . . is the fact of the necessary and irremediable ignorance on everyone’s part of most of the particular facts which determine the actions of all the several members of human society . . . . it is a very inconvenient fact which makes both our attempts to explain and our attempts to influence intelligently the processes of society very and much more difficult, and which places severe limits on what we can say or do about them.”  

For Hayek, society can function because millions of individuals, each with a very limited store of knowledge, are constantly making adjustments in their behavior, responding to the signals they receive from their environment, including the actions of others. This is the source of society’s “spontaneous order,” not the top-down directives of government.   

So, it’s strange, to say the least, to see contemporary admirers of Hayek advocating precisely the thing that he argued would lead to disaster. The worst offender among the (neo) conservatives is Michael Ledeen, of the American Enterprise Institute and frequent contributor to National Review. Ledeen has made his name as the apostle of “exporting the democratic revolution.” He has spelled out an ambitious agenda for the U.S. to topple the “terror master” regimes of Iraq , Iran , Saudi Arabia , and Syria and replace them with functioning democracies. From totalitarianism to Jeffersonian republicanism in a few short, simple steps!  

Recently Ledeen wrote:

“Now that we are set to have our great debate on the war against terrorism, it seems it will be the wrong debate.

“By all indications, the discussion will be about using our irresistible military might against a single country in order to bring down its leader. We should instead be talking about using all our political, moral and military genius to support a vast democratic revolution to liberate all the peoples of the Middle East from tyranny. That is our real mission, the essence of the war in which we are engaged, and the proper subject of our national debate.”  

And, lest you think the long-suffering U.S. taxpayer might get off with simply overthrowing a few unsavory regimes, we must stay on, occupying these nations and offering the heathens tutelage in the ways of democracy.

“Once the terror regimes are brought down, we will be obliged to play an active role to ensure that we do not simply replace one dictator with another, as the CIA has so often proposed. We must remember that the defeat of the fascists in World War II was only half the mission of that great American generation. The other half was purging Germany and Japan of those still loyal to, or tempted by, the old order and training, defending and supporting the fledgling democrats until the rules of a free society were assimilated into the national cultures.”

According to Ledeen, the U.S. has the knowledge and the means to initiate and guide a chain of events leading to a stable and democratic Middle East . The “historic mission” of the U.S. is to be an engine of “creative destruction” that sweeps aside tradition, habit, and custom and remakes the world in its own image. How a government that Ledeen presumably believes could not successfully plan an economy is supposed to plan a “democratic revolution” in no less than four countries remains a bit of a mystery.

In the “libertarian” camp we have Brink Lindsey, who, while more sober than Ledeen, argues that “there’s no invisible hand in foreign affairs.”  

“What about the principle of no preventive wars? Specifically, what is the basis for assuming that preventive wars always make matters worse? In economic policy, there are extremely solid grounds for the principle of no government meddling with markets. Market competition has enormous advantages over government action in making use of and coordinating dispersed information, in encouraging innovation, in supplying appropriate incentive structures, etc. Accordingly, anyone arguing that government intervention in the marketplace can improve economic performance has an extremely difficult case to make.  

“Many libertarians slide easily from noninterventionism in domestic affairs to noninterventionism abroad, and believe that they're on equally firm footing with both positions. But they're not, because the fact is that there's no invisible hand in foreign affairs. There are no equilibrating mechanisms or feedback loops in the Hobbesian jungle of predatory dictatorships and fanatical terrorist groups that give us any assurance that, if the United States were only to stand aside, things would go as well for us in the world as they possibly could.”  

But Lindsey is missing the point of the “Hayekean” argument against interventionism. The point is not that we know that preventive wars always make matters worse, it’s that we simply don’t know what the results of any given war will be. War is always unpredictable; who could’ve foreseen with certainty that World War I, the “war to end all wars,” would have repercussions that brought on the even bloodier Second World War? Or that supporting the Mujahadeen during the Soviet occupation of Afghanistan could help create the killers of 9/11? War has a tendency to unleash forces that its planners are not, and probably could not be, aware of. It’s precisely because of the unpredictable and destructive nature of war that it should be entered into cautiously and only as a last resort. It may be a legitimate means of defending ourselves, but it’s not an effective instrument of social engineering.  

What the necons and “neolibs” seem to be saying is that, while Hayek may be right that economic central planning is a mistake, it’s not only possible, but imperative, that we engage in a kind of geopolitical central planning! Government planners might not be able to know how many shoes to produce or how much steel needs to be shipped to Detroit , but they somehow know how to rebuild entire societies following an invasion of Iraq or even an all-out “war of liberation” in the Middle East . Not only that, but they can know what kind of governments and economic systems are compatible with the history and cultures of Iraq , Iran , Saudi Arabia , and Syria and how to implement them. And they know that there won’t be any “blowback” in the form of new terrorist attacks on U.S. soil as a result of this bloody conflagration. How lucky we are to have leaders who’ve been blessed with such knowledge! You might almost call it omniscience. Of course, if we take Hayek’s insight seriously, we have to realize that our government does not, and cannot, have the knowledge required to undertake and manage such an ambitious project (even if it were desirable). Ignoring the limits of our knowledge is a form of hubris that is likely to have serious repercussions down the road. Those who claim to have learned from F.A. Hayek should know better.