[3] Miscellaneous Contributions to A Debate on Spontaneous Order

[In statu nascendi]

In an article entitled "Does Hayek Make Sense?", Tyler Cowen tries to glorify his trivial and woolly take on Hayek (based on a cursory reading of Hayek's last book "The Fatal Conceit") into a show of profundity that culminates in the oracular conclusion (still upheld 20 years after writing the article) that he does not know whether Hayek makes sense to him or not.

Little wonder, as neither then nor 20 years later did he bother to study Hayek carefully.

In February 2007, I participated in the ensuing discussion at Tyler Cowen's blog "Marginal Revolution". Here are some excerpts from it:

Dear Tyler,

Having read your short essay, I still cannot grasp what is troubling you about Hayek's stance?

Hayek provides a rich theory of TAXIS (a made order), COSMOS (a grown or spontaneous order) and the interaction of taxis and cosmos. Agents of the spontaneous order such as firms will to a large extent be run in the manner of taxis. This is also true for agents that one might consider part of the public sector - law enforcing institutions, for example. Agents such as firms or courts or political bodies must, however, be allowed or induced to interact in such a way as to further rather than stifle the spontaneous order of the market or the rule of law or most generally the freedom of society. While being taxis-type institutions (to some extent or even to a large extent), what matters is that their interaction obeys the requirements of a Great Society (Adam Smith) or Open Society (Popper), i.e. that their interaction is not regulated by taxis-type rules but by cosmos-type rules. Thus, we may quite purposefully design an organisational framework for a law enforcing institution (thus engaging in taxis-type behaviour), however, only to make it as efficient as we can in safeguarding "general rules of just conduct", which promote cosmos-type of behaviour, the very precondition of a free society. This is analogous to running, planing and organising a company (taxis-type behaviour) that in its interaction with other companies must observe "general rules of just conduct", to guarantee the spontaneous order of the market (cosmos-type behaviour).

Kind regards,

IGTU

Posted by: IGTU at Feb 14, 2007 4:12:31 PM

My vote is on NO.

(Said with the intonation from Little Britain's "Computer says NO." sketch.)

Posted by: Gabriel M. at Feb 14, 2007 5:25:00 PM

Dear Gabriel,

I am not that interested in your intonation as in the reasons you have to say "no", and what exactly it is that you are negating.

Kind regards,

IGTU

Posted by: IGTU at Feb 14, 2007 5:54:19 PM

I'm glad you dug up this old essay for us.

I vote "no" on Hayek. He went Pangloss on us when he started making a fuss about spontaneous order, evolved institutions, morals, etc. I agree with pre-anti-liberal John Gray's point (in the article next to yours) about many of our institutions, religions, etc being contingencies. (So says my gut). And thus Hayek's full of hot air.

Anyway, J.S. Mill is all we need---Now there's a liberal!

Posted by: Lee at Feb 14, 2007 7:39:50 PM

I've gotten my Hayek secondhand, but my feelings on what I've heard are identical to Tyler's.

Posted by: Scott Scheule at Feb 14, 2007 7:44:49 PM

Intonations, second-hand "knowledge" (flippantly admitted), feelings and "spontaneous organisations" (the equivalent of rendering Marx as treating of "communist capitalism", for in Hayek's terminology an "organisation" is crucially different from a "spontaneous order") - I say goodbye to all that and take my leave from the "cool" party atmosphere created by fine critical minds too conscientious and deep for me.

Posted by: IGTU at Feb 14, 2007 8:32:03 PM

IGTU,

I actually thought that you and I were more or less on the same page. I read your interpretation as nearly identical to mine. As for spontanious organization (not organizations) I think Hayek would agree that the emergent order of the millions of individual interactions within a complex system is a form of organization - a kind of spontaneous organization which works much better than for example planning. The economics of organization and coordination could do very well to learn from Hayek.

Posted by: liberty at Feb 14, 2007 8:47:59 PM

I'm pretty sure this isn't supposed to be a vote.

Posted by: josh at Feb 15, 2007 9:08:21 AM

Dear Liberty,

(1) Apologies for the "friendly fire".

(2) This is the second time that I follow a blog-"thread" associated with a prestigious American University, only to encounter the same disappointing pattern. A big shot conferencier proposes a riddle (which is not really a riddle but a confusion on the part of the big shot). Comments are made, as an exercise in the "abuse of democracy from below" ("Hey, I got a right to an opinion, don't I!" Disregarding the fact that with an endless range of things to have an opinion on, it should always be our striving to pronounce an opinion on matters that we have seriously looked into - unless FORCED to give an unsubstantiated opinion).

The big shot does not condescend to comment (presumably being busy to start the next fire and wise enough not to get entangled in an exchange that might damage his authority). And indeed, his authority (in the issue at hand) is never seriously questioned - partly because no one knows what they are talking about, partly because the courtier-commentators - cheeky and assertive as they may be - like to bask in the big shot's sunshine.

Characteristically, turning the "thread" into an election serves to nobilitate unsubstantiated opinion at the expense of intellectual substance. Or to put it differently: There is absolutely no need to vote on the issue (except for the doubtful reason just given). Instead, what is very much needed is the spelling out of arguments. But: in no time, everyone rushes on to the next droplet to repeat the subcultural exercise.

(3) Dear Liberty, I think I understand your position and agree with it. However, it is not fellicitous that you used an expression that represents a "contradictio in adjecto" in terms of Hayek's terminology. He contrasts "organisation(s)" against a "spontaneous order", which is the very essence of the distinction between TAXIS and COSMOS. For everyone interested in some enlightenment on this question - do read Hayeks "Arten der Ordnung" (Freiburger Studien, p.32) or "Two kinds or order" (if I remember the English title correctly - one of the papers in either "Studies in..." or "New Studies in...") - which should be readily available from the library of a prestigious American University.

Kind regards,

IGTU

Posted by: IGTU at Feb 15, 2007 2:00:48 PM

I think there is a fairly neat parallel between "spontaneous" as applied to activities within an organization, and as applied to activities within a polity, based on parallel ideas of whether there is an encompassing owner at the level in question. The upshot is that for the polity level, which Hayek is really concerned with, "spontaneous" shakes down as "voluntary," and Hayek is thus really basically within the Locke-Smith-Spencer-Rothbard-etc. definition of liberty (circumlocutions in the Constitution of Liberty notwithstanding). As for the claims for liberty, he would be with Smith, not Rothbard. I tend to read Hayek as a strategic writer who knew not to be too plain about the definition of liberty/coercion. Bottom line: "spontanoeus order" basically mean "voluntary order".

Posted by: Daniel Klein at Feb 15, 2007 3:13:21 PM

Dear Daniel,

By raising the issue of "voluntariness", I do not think you are putting your finger on it. A "(man-)made order" (taxis) and a "spontaneous or grown order" (cosmos) may both be the result of unconstrained volition, the result of "voluntary" action. (Run your company as you see fit, go about it as voluntarily as you like.) And vice versa, a free society, the rule of law, the enforcement of "generally applicable rules of just conduct" may represent constraints on voluntary action.

The crucial point is both a very practical and an epistemological one: where and how to maximize the use of dispersed knowledge.

If we run society like an organisation (taxis) we will be considerably less successful in attaining the maximising goal.

Kind regards,

IGTU

Posted by: IGTU at Feb 15, 2007 3:41:15 PM

IGTU: Notice that I spoke of two levels. As for dispersed knowledge, yeah, sure.

Posted by: Daniel Klein at Feb 15, 2007 5:06:59 PM

Dear Daniel,

Hayek has tried to draw our attention to the need to make distinctions between different types of rules, those characteristic of taxis and those characteristic of cosmos.

Taxis-type rules tell you (on a very high level of concreteness) specifically what to do (akin to or exactly like COMMANDS meant to expedite a very specific assignment: "turn left, then right, then push the blue button").

Cosmos-type rules tell you (on a very high level of abstraction) what not to do, thus creating highly general limitations within which you are entirely free to act as you wish.

A taxis-environment may grant far more scope for voluntary action than a cosmos-environment. Stalin operated in a taxis-environment; a libertarian society must have been unspeakably restrictive to him and his supporters - who may well have represented a majority within the Soviet population.

Equally, from the point of view of government as we know it, a libertarian society would be unspeakably restrictive - for it would not allow us to declare to be the law whatever commands an elected political body decides to issue. In a libertarian society (largely a private law society) we would have to prove that a law (outside of public law) is not a command of the taxis-type but a rule of the cosmos-type. Which in turn would provide the basis for a meaningful separation of powers, and would oust the seeming need for a sovereign (a final instance of unrestricted power, the King, the President, the Führer, the People or what have you) in favour of sound legal criteria to discern between proposed laws that are compatible or incompatible with liberty, as the case may be.

So Hayek's distinction between taxis and cosmos (type of rules) is also (among its many other uses) a crucial auxiliary means in debunking legal positivism - which is the essence of our legal system (and the fraud of calling something "the rule of law" that isn't the rule of law.)

Kind regards,

IGTU

Posted by: IGTU at Feb 15, 2007 6:03:38 PM

i think the bigshot you're attacking admitted he wasn't sure where he now stood on things and would be interested to hear other's positions. i'm with you on the depth of thought reflect by comments on many blogs, but that's somewhat of an odd charge to bring against commenters here (who are by and large fairly serious, experienced, educated, etc.

and i didn't know we were at a conference.

Posted by: dj superflat at Feb 15, 2007 7:27:43 PM

From an Enlightenment or Positivist point of view, which is Hume's point of view, and mine, there is simply no avoiding the conclusion that the human race is mad. There are scarcely any human beings who do not have some lunatic beliefs or other to which they attach great importance. People are mostly sane enough, of course, in the affairs of common life: the getting of food, shelter, and so on. But the moment they attempt any depth or generality of thought, they go mad almost infallibly. The vast majority adopt the local religious madness, as naturally as they adopt the local dress. But the more powerful minds will, equally infallibly, fall into the worship of some intelligent and dangerous lunatic, such as Plato, or Augustine, or Comte, or Hegel, or Marx.
David Stove, The Plato Cult, 1991

Or Hayek.

Posted by: Mike Huben at Feb 15, 2007 7:39:38 PM

Dear Daniel,

You concluded:

Bottom line: "spontanoeus order" basically mean "voluntary order".

To the contrary, in a planned society - toward which we have been moving for so long - we are trying to create a voluntary order, an order derived from and in line with our volition: Let no one make less than x $ an hour.

In a free society an "involuntary order" prevails, for no one expressly intends to bring about much higher income and wealth than in a planned society, yet this will be the result.

The first to see this was Mandeville and the most famous proponent of the idea was a certain Adam Smith.

Capitalism (an economic order dependent on a free society) cannot work in the absence of a genuine rule of law. To understand the true meaning of the rule of law, we need to comprehend the difference between taxis and cosmos type of rules.

I know of no other author, who has made the nexus more intelligible that exists between the institutions of liberty. Hayek has never looked around to see which department he belonged to and then looked at the world from the home perspective. He has stuck to the questions he had and let them take him to whatever department might be helpful in answering them. This is one of the reasons why he is so unpopular: He is too much of a jurist to the economist and vice versa, too much of an economist to the epistemologist, too much of an epistemologist to the political scientist and so on. What is really hard to come to grips with in Hayek is that he brings us from his journey among the worlds ideas that we are NOT USED TO. It is not the intricacy of his thoughts as such - it is that our thinking is so compartmentalised, so trained not to think in a truly interdisciplinary way. I cannot read Hayek without finding instructive messages I have missed before.

Kind regards,

IGTU

Posted by: IGTU at Feb 15, 2007 7:47:02 PM

Dear DJ Superflat,

Message 1: What are your thoughts on "Does Hayek Make Sense?"

Message 2: Anyone who (non-vicariously) feels he has reason to complain about bad behaviour on my part, let me know.

Kind regards,

IGTU

Posted by: IGTU at Feb 15, 2007 8:23:56 PM

Dear Mike,

I find it hard to comment on your contribution. Your quote suggests that Hume was part of the Enlightenment. Fair enough - but which strand of the Enlightenment are we talking about? He had a great fight with Rousseau, to put it mildly. And the Scottish Enlightenment deviated dramatically from the core propositions of leading figures of other, more well known strands of the Enlightenment - such as Voltaire. Hume a positivist - would you explain in what way he deserves to be treated as a positivist? And finally, regarding your own, immediate, prolific contribution ("Or Hayek.): I first read Hume, and when eventually coming across Hayek, I was struck by the extent of agreement to be found between the two. Do you mean to suggest that from a Humean point of view, Hayek ought to be regarded as a madman? Let us have more on that, please.

Kind regards,

IGTU

Posted by: IGTU at Feb 15, 2007 8:37:59 PM

Mike,

Do you believe any of Hayek's views on spontaneous order to be false? If so, why don't you quote Hayek and explain why he's incorrect rather than demonstrate your abilities to cut, paste, and assert?

Posted by: James at Feb 16, 2007 12:49:17 PM

James:

Hayek's "spontaneous order" versus "designed order" is a typical false dichotomy that obscures the reality of evolutionary systems. Evolutionary systems develop due to accretion (among other things.) Take for example his claim 'We have never designed our economic system. We were not intelligent enough for that'. That's nonsense: our economic system is a product of accreted designs, selected deliberately by central planners who thought we needed stable property, stable currency, transparent financial institutions, and a host of other things. There are aspects that are spontaneous and aspects that are designed.

IGTU:

If you don't know which strand of the enlightenment Hume occupied, look it up. It's pretty damned obvious.

David Stove's point of view was that supposedly great thinkers were pathological. The quote was from his chapter "What is Wrong with Our Thoughts." My view of Hayek is that his writings are pathological because of his fixation on propagandizing capitalism.

I'm far from the only person who thinks this way:
"[What Hayek] does not see, or will not admit, [is] that a return to "free" competition means for the great mass of people a tyranny probably worse, because more irresponsible, than that of the State. The trouble with competitions is that somebody wins them. Professor Hayek denies that free capitalism necessarily leads to monopoly, but in practice that is where it has led, and since the vast majority of people would far rather have State regimentation than slumps and unemployment, the drift towards collectivism is bound to continue if popular opinion has any say in the matter."
George Orwell, in a 1944 review of "The Road to Serfdom" by F.A. Hayek and "The Mirror of the Past" by K. Zilliacus

"But let us never forget, either, as all conventional history of philosophy conspires to make us forget, what the 'great thinkers' really are: proper objects, indeed, of pity, but even more, of horror."
David Stove

Posted by: Mike Huben at Feb 16, 2007 5:14:58 PM

Dear Mike Huben,

(1)

You suggested to me:

"If you don't know which strand of the enlightenment Hume occupied, look it up. It's pretty damned obvious."

If the issue is "pretty damned obvious" to grasp or easy to look up, why have Stove and Huben failed to do just that?

Treating the Enlightenment as an intellectual monolith and thinkers such as Voltaire and Rousseau, on the one hand, and Hume, on the other, as congenial is akin to regarding, say, Marx and Popper, as representatives of the same school of thought, because both believed themselves to be human beings rather than Mauritian dodos.

Lumping together the French philosophers Voltaire to Condorcet, on the one hand, and Scottish and English thinkers from Mandeville, Hume, Adam Smith to Edmund Burke, on the other, is to overlook the essential and irreconcilable differences between them, which are far more significant than any similarities.

Incisively, Hume has been portrayed as beating the (French) Enlightenment at its own game, pruning the boundless ambitions of reason by dint of rational analysis. True liberalism is about respecting reason by understanding and accommodating the limits of reason.

Unfortunately, the French interpretation of the ideals of political freedom has largely superseded the earlier, foundational British reading - which, I suspect, is why in the United States socialists and social democrats (supporters of the Democratic party) are called liberals, a term more appropriately applicable to those adhering to the ideas proposed by the British founding fathers of liberalism - above all Hume, whose work, preceding French "liberalism", paved the way for the Scottish moral philosophers Adam Furgeson, Adam Smith, Dugald Steward, and the authors of the American Constitution, (and the adoption of the evolutionary paradigm by Charles Darwin for the purposes of the natural sciences).

Hume's enlightenment deals with civilization as a growing order, whose quality and success depend on safeguarding the spontaneous forces underlying its development; the French enlightenment considers civilization an engineering feat of the human mind, it considers society an organization, whose quality depends on the degree to which man's conscious design is efficacious in shaping it. French Enlightenment is cognitively primitive, it thinks of an abstract order (a complex society with hundreds of million of people, most of whom do not know each other) as immediately and concretely comprehensible and fruitfully regimentable as a tribe. Hume's Enlightenment is about a complex society, where abstract rules of just conduct (rather than interested tribal commands) are required to promote the freedom and justice needed to benefit from the immense diversity of interests and values prevailing among millions of people.

Hume's enlightenment is about the principled "rule of law" (to constrain any powers-that-be, among other functions of the rule of law); the French enlightenment is about the unprincipled "rule of men (who happen to be in power)".

(2)

This is not the place to enlarge on why I object to Orwell's
"fixation on propagandizing [anti-]capitalism...monopoly [see below]... State regimentation...and collecticism". (from your quote above).

It is not clear what "unfree" competition is supposed to be - though I have a suspicion what Orwell is driving at. Suffice it to mention that the vices of "capitalism" are really the vices of a highly politicised society ("the rule of men") that - in the absence of the rule of law - induces and depends on a rat-race for the provision of special interests and its stifling imposition on a spontaneous order, which results in monopolies and countless other "bads" such as illegitimate wars, economic depression, retarded economic development or insolvent nations.

There are numerous papers explaining convincingly why economic competition is not a zero-sum game. The most graphic counter-argument in the face of the zeo-sum proposition is the computer in front of your nose, your standard of living for which Hume, a rich man in his day, would envy you. Of course, one might regard, say, friendship a zero-sum game on the grounds that - to maintain a good relationship - friends (say, spouses) sometimes have to make painful concessions and adjustments to their (initial) plans - but that is as short-sighted as the idea that competition is a zero-sum game, because, say, GM would end up a looser if it tried to survive by making sedans (carried by "Chairmen" in the language of Adam Smith), rather than prospering by producing what people are prepared to spend their money on - these days. The false zero-sum claim is a convenient substitute for saying: "Having to make an effort, possibly incurring costs and losses, and the opportunity for someone else to be more successful than you is anti-social".

Kind regards,

IGTU

Posted by: IGTU at Feb 18, 2007 3:25:35 PM

IGTU,

What is the next step?

You use "spontaneous order" with misplaced concreteness; you are turning it into a realizable thing. As Tyler Cowen notes in his old article, it is almost another historicism.

It's a problem from the beginning of the market order. Hume's "abstract rules of just conduct" for "civilization as a growing order" were given advantage by the violence, well known at the time, of "primitive accumulation" and later the Poor Laws. That is how the total market system was instituted. I don't blame Hume for it, although he must have known its long history and the contemporary news items (as did Adam Smith,) --and neither mentioned it. Yet it seems how shall we call it "rationally constructed," a bit of a no-no in the Hayekian sphere.

It is hard to think of, say, "enclosure" as anything other than an engineering feat upon human society of the sort you say that is so loved by the French. It's a good thing that a few eggs can be broken, or else we couldn't tell one from the other! So isn't the distribution of light in the Enlightment something of a spectral prism? Certainly, none of Hume's PRACTICAL constructions can compare, in application, to the mechanical productiveness of Descartes' algebraic geometry, or (keeping it to Voltaire's times,) Montesquieu's separation of powers. Indeed the French also cook better, which is really about as far into the abstract order as two hands can get. (I love David Hume, don't paint me otherwise -- though I don't think cause-and-effect by itself is an interesting problem.)

IGTU, your real problem is that the "spontaneous order" isn't quite the shining city on a hill we hoped. Let us put aside the environmental situation; it requires a study of the science of ecology to discuss the effects of economics upon it. (In passing, we note that the degree of division of labor in our advanced economy has led to an atomization of the intellect that is a little frightening...) You write, "the vices of 'capitalism' are really the vices of a highly politicised society..." Okay: So do you believe that the lopsided distribution of wealth and income will be lessened by less "politicization?" Or do you believe that the distribution of wealth and income is NOT a vice, because you believe it maps the natural productivity of a spontaneous abstract order?

Posted by: Lee A. Arnold at Feb 18, 2007 11:59:07 PM

Dear Lee A. Arnold,

If our wealth and income is not subjected to arbitrary (re-)distribution, if it is allowed to emerge as the product of a spontaneous process, and if it is respected as the outcome of efforts that involve no injustice, as is the case in the highly "lopsided" pecuniary differential between Bill Gates and IGTU, I not only believe that there is no need to worry about inequality but also that inequality is the stepping stone to a still higher level of wealth and income. For where human beings are allowed to use their knowledge to their purposes - constrained only by the rule of law -, more wealth and income will be created than in any other arrangement. This will of necessity and unproblematically require inequality to prevail, as the more efficient is given the chance to differentiate himself from the less efficient and earn a reward that will raise his wealth and income above the level achieved by the less efficient (who benefits from the more efficient, as I do in not having to hire/ underemploy/misallocate employees for work that can be done by my computer, through which I can access countless libraries that I do not have to build and go about my humble business in hitherto unimaginable efficacy).

The roundabout process that results in a striking difference between the net worth of Bill Gates and IGTU is not an outcome planned and effected by an author who resolved to achieve such a distribution of wealth and income. As such it is an instance that can be conceptualised in terms of a spontaneous order.

A large part of Hayek's work is dedicated to the study of order of this kind, the conditions of its beneficial growth, its improvement, the threats to it and the possibility of its decline.

Its intention is to learn more about the way in which man ought to comport himself so as to benefit from an order superior to arrangements limited by the powers of comprehension of any human mind.

Not concrete design and specific anticipation but the observance of appropriately chosen rules are key to utilising such a spontaneous order.

If Tyler Cowen wishes to make sense of Hayek, he would be well advised to study Hayek's research into the nature of these rules. The taxonomical approach taken in Tyler Cowen's essay is sterile, in fact, it is embarrassing in someone who has the audacity to review the last book of such a prolific, long- and well-known scientist, and only good enough to entertain a class of undergraduates haplessly innocent of the subject-matter. (Is my local football club a spontaneous order? No. Okay, next. What about the police? Organization or spontaneous order? What? Spontaneous order? Is he suggesting this? Oh, dear, oh, dear, isn't Hayek getting it wrong here?)

I can't fathom where Cowen gets the idea from that Hayek excludes the public sector from an analysis of these rules - in fact, Hayek dedicates hundreds and thousands of pages to investigating agents of that sector.

As for the conclusion of Cowen's essay, the author may wish to take a look at the "Postscript" to "The Constitution of Liberty", where Hayek explains "Why I Am Not a Conservative".

Kind regards,

IGTU

Posted by: IGTU at Feb 19, 2007 1:23:05 PM

What are the written laws for the "spontaneous order" which prevent injustices in the distribution of wealth?

Posted by: Lee A. Arnold at Feb 19, 2007 7:51:55 PM

Dear Lee A. Arnold,

While our blog-thread has disappeared into the archive, and I feel, I have said what I had to say, let me take my leave by quoting Friedrich August (Hayek) to provide some clues that might help answer your last question:

"It is perhaps not surprising that men should have applied to joint efforts of the actions of many people, even where these were never foreseen or intended [see my Bill Gates and IGTU. example above, IGTU] the conception of justice which they had developed with respect to the conduct of individuals towards each other. 'Social' justice...came to be regarded as an attribute which the 'actions' of society, or the 'treatment' of individuals and groups by society, ought to possess. As primitive thinking usually does when first noticing some regular processes, the results of the spontaneous ordering of the market were interpreted as if some thinking being deliberately directed them, or as if the particular benefits or harm different persons derived from them were determined by deliberate acts of will, and could therefore be guided by moral rules. This conception of 'social' justice is thus a direct consequence of that anthropomorphism or personification by which naive thinking tries to account for all self-ordering processes. It is a sign of the immaturity of our minds that we have not yet outgrown these primitive consepts and still demand from an impersonal process which brings about a greater satisfaction of human desires than any deliberate human organization could achieve, that it conform to the moral precepts men have evolved for the guidance of their individual actions." (Law, Legislation and Liberty (LLL),Volume 2, The Mirage of Social Justice,p. 62 ff, Chicago, 1978)

"Such statements which explicitly connect 'social and distributive justice' with the treatment by society of the individuals according to their 'deserts' bring out most clearly its difference from plain justice, and at the same time the cause of the vacuity of the concept: the demand for 'social justice' is addressed not to the individual but to society - yet society, in the strict sense in which it must be distinguished from the apparatus of government, is incapable of acting for a specific purpose, and the demand for 'social justice' therefore becomes a demand that the members of society should organize themselves in a manner which makes it possible to assign particular shares of the product of society to the different individuals or groups." (item, p.64)

"It has of course to be admitted that the manner in which the benefits and burdens are apportioned by the market mechanism would in many instances have to be regarded as very unjust IF [change of character by IGTU, IGTU] it were the result of a deliberate allocation to particular people. But this is not the case. Those shares are the outcome of a process the effect of which on particular people was neither intended nor foreseen by anyone when the institutions first appeared - institutions which were then permitted to continue because it was found that they improve for all or most the prospects of having their needs satisfied. To demand justice from such a process is clearly absurd, and to single out some people in such a society as entitled to a particular share evidently unjust. (item, p.64 f)

"The expression ['social justice', IGTU] of course described from the beginning the aspirations which were at the heart of socialism. Although classical socialism has usually been defined by its demand for the socialization of the means of production, this was for it chiefly a means thought to be essential in order to bring about a 'just' distribution of wealth; and since socialists have later discovered that this redistribution could in a great measure, and against less resistance, be brought about by taxation (and government services financed by it), and have in practice often shelved their earlier demands, the realization of 'social justice' has become their chief promise. It might indeed be said that the main difference between the order of society at which classical liberalism aimed and the sort of society into which it is now being transformed is that the former was governed by principles of just individual conduct while the new society is to satisfy the demands for 'social justice' - or, in other words, that the former demanded just action by the individuals while the latter more and more places the duty of justice on authorities with power to command people what to do." (item, p.65 f)

"The commitment to 'social justice' has in fact become the chief outlet for moral emotion, the distinguishing attribute of the good man, and the recognized sign of the possession of a moral conscience. Though people may occasionally be perplexed to say which of the conflicting claims advanced in its name are valid, scarcely anyone doubts that the expression has a definite meaning, describes a high ideal, and points to grave defects of the existing social order which urgently call for correction...But the near-universal acceptance of a belief does not prove that it is valid or even meaningful any more than the general belief in witches or ghosts proved the validity of these concepts. What we have to deal with in the case of 'social justice' is simply a quasi-religious superstition of the kind which we should respectfully leave in peace so long as it merely makes those happy who hold it, but which we must fight when it becomes the pretext of coercing other men. And the prevailing belief in 'social justice' is at present probably the gravest threat to most other values of a free civilization." (item, P.66 f)

"It is now necessary clearly to distinguish between two wholly different problems which the demand for 'social justice' raises in a market order.

The first is whether within an economic order based on the market the concept of 'social justice' has any meaning or content whatever.
The second is whether it is possible to preserve a market order while imposing upon it (in the name of 'social justice' or any other pretext) some pattern of remuneration based on the assessment of the performance or the needs of different individuals or groups by an authority possessing the power to enforce it.

The answer to each of these questions is a clear no.

Yet it is the general belief in the validity of the concept of ' social justice' which drives all contemporary societies into greater and greater efforts of the second kind and which has a peculiar self-accelerating tendency; the more dependent the position of the individuals or groups is seen to become on the actions of government, the more they will insist that governments aim at some recognizable scheme of distributive justice; and the more governments try to realize some preconceived pattern of desirable distribution, the more they must subject the position of the different individuals and groups to their control. So long as the belief in 'social justice' governs political action, this process must progressively approach nearer and nearer to a totalitarian society." (item, p 67 f)

Finally, let me ask a question, although we are not likely to receive an answer to it:

Tyler Cowen, do you feel you have been helped by our contributions to the present thread in deciding whether you are able to make sense of Hayek or not?

Kind regards,

IGTU

[2] Miscellaneous Contributions to A Debate on Spontaneous Order

Dear Lee A. Arnold,

There has never been anything like a big bang creating capitalism. Capitalist structures have been around for thousands of years and proved resilient enough to survive even in severely anti-capitalist environments - such as the Soviet Union (SU), whose survival critically hinged on the disproportionate contributions made by "capitalists" - consider the private provision of food in the SU, for instance.

On the level of society taxis [an order intended and brought about by man] is always embedded in cosmos [a self-generating order, partly influence by human action but not the result og human design] - and the question is: how do we make sure that taxis is not a destructive influence on cosmos - as when, for example, a central plan stifles spontaneous forces, creating unintended consequences (by definition on the level of cosmos) of the most detrimental kind (SU = Burkina Faso + atom bomb). How the prevalent political system in the West causes incongruence between taxis and cosmos, I shall explain below and in a second entry.

The circumstances which led to capitalism's historical break-through, in the sense that thanks to larger markets and a more comprehensive adoption of practices and institutions favourable to it (see North/Thomas "The Rise of the West") men were able - for the first time in history - to achieve sustainable growth (population growth + productivity growth = rising welfare for all) are too many faceted to be dealt with here - but they certainly represent a complicated and protracted evolutionary pattern (an intricate process of trial and error, in which those prevailed that followed superior practices, without necessarily understanding that these should turn out superior), rather than a single ignition event, let alone a premeditated conspiracy of capitalists (the latter notion being another example of primitive anthropomorphic thinking). Yes, capitalism created the proletariat - for without capitalism these workers would not have been able to survive or be born, in the first place.

As for the atrocious conditions supposedly brought about by capitalism, let me quote from a letter written about 1843 by a London lady, who refers to a man, who refused to visit Lancashire because: "...it was a horrid place - factories all over. [The man claiming] that the people, from starvation, oppression, and over-work, had almost lost the form of humanity...[On asking him in what part he had seen such misery:] He replied, that "he had never seen it, but had been told that it existed...This gentlemen was one of the very numerous body of people who spread reports without ever taking the trouble of inquiring if they be true or false. [The lady reports from her visit to the "atrocious"place]: "Now that I have seen the factory people at their work, in their cottages and in their schools, I am totally at a loss to account for the outcry that has been made against them. They are better clothed, better fed, and better conducted than many other classes of working people." (Capitalism and the Historians, Chicago 1963, p. 20 f)

Sensationalist propaganda lies from the 19th century (easier to grasp than the roundabout process of wealth-creation) continue to befuddle people today, who think their kind disposition and powerful minds can understand and direct adequately the station in society of hundred of millions.

The idea of "social justice" can be given meaning only when we are prepared to elect an absoute authority entitled to determine each persons position, income and duties in society - and pronounce their conduct "just" or "unjust" depending on their compliance with these determinations.

Only human conduct can be called just or unjust. If we apply the terms to a state of affairs, they have meaning only in so far as we hold someone responsible for bringing it about or allowing it to come about. To apply the term "just" to circumstances other than human actions or rules governing them is a category mistake.

A category mistake - which we are happy to make every day, and base our confused and counter-productive political convictions on.

If there is anything "admirable" about our present political order, it is its ability to entice people to believe in its sanctity and in the delusion that it truly represents what we want - though there is enough information around to comprehend the fiction.

Arnold, you seem to complain about social injustice (whatever you may mean by it) and lopsided distribution, while being at the same time happy with the system that creates it. Presumably because you think that what is bad about the system is the result of capitalism, while what is good about it is given to us by countervailing democracy. This attitude strikes me as the result of understanding neither capitalism nor democracy (in its present form):

"The fundamental reason why the best that a government can give a great society of free men is negative is the unalterable ignorance of any single mind, or any organization that can direct human action, of the immeasurable multitude of particular facts which must determine the order of its activities. Only fools believe that they know all, but there are many. This ignorance is the cause why government can only assist (or perhaps make possible) the formation of an abstract pattern or structure in which the several expectations of the members approximately match each other, through making these members observe certain negative rules or prohibitions which are independent of particular purposes. It can only assure the abstract character and not the positive content of the order that will arise from the individuals' use of their knowledge for their purpose by delimiting their domains against each other by abstract and negative rules.

[...]

Not only peace, justice and liberty, but also democracy is basically a negative value, a procedural rule which serves as protection against despotism and tyranny...or to put it differently, a convention which mainly serves to prevent harm. But like liberty and justice, it is now being destroyed by endeavours to give it a 'positive' content." (LLL, Volume 3, p. 130 ff, Chicago 1981)

I shall continue the quote in another entry.

Kind regards,

IGTU

Posted by: IGTU at Feb 23, 2007 10:33:27 AM

Continued:

"...under the prevailing system it is not the common opinion of a majority that decides on common issues, but a majority that owes its existence and power to the gratifying of the special interests of numerous small groups, which the representatives cannot refuse to grant if they are to remain a majority. But while agreement of the majority of a great society on general rules is possible, the so-called approval by the majority of a conglomerate of measures serving particular interests is a farce. Buying majority support by deals with special interests, though this is what contemporary democracy has come to mean, has nothing to do with the original ideal of democracy, and is certainly contrary to the more fundamental moral conception that all use of force ought to be guided and limited by the opinion of the majority. The vote-buying process which we have come to accept as a necessary part of the democracy we know, and which indeed is inevitable in a representative assembly which has the power both to pass general laws and to issue commands, is morally indefensible and produces all that which to the outsider appears as contemptible in politics. It is certainly not a necessary consequence of the ideal that the opinion of the majority should rule, but is in conflict with it.

This error is closely connected with the misconception that the majority must be free to do what it likes. A majority of the representatives of the people based on bargaining over group demands can never represent the opinion of the majority of the people. Such 'freedom of Parliament' means the oppression of the people [such much for the 'road to serfdom', IGTU]. It is wholly in conflict with the conception of a constitutional limitation of governmental power, and irreconcilable with the ideal of a society of free men. The exercise of the power of a representative democracy beyond the range where voters can comprehend the significance of its decisions can correspond to (or be controlled by) the opinion of the majority of the people only if in all its coercive measures government is confined to rules which apply equally to all members of the community.

So long as the present form of government persists, decent government cannot exist, even if the politicians are angels or profoundly convinced of the supreme value of personal freedom. We have no right to blame them for what they do, because it is we who, by maintaining the present institutions, place them in a position in which they can obtain power to do any good only if they commit themselves to secure special benefits for various groups. This has led to the attempt to justify these measures by the construction of a pseudo-ethics, called 'social justice', which fails every test which a system of moral rules must satisfy in order to secure a peace and voluntary co-operation of free men.

...what in a society of free men can alone justify coercion is a predominant opinion on the principles which ought to govern and restrain individual conduct. It is obvious that a peaceful and prosperous society can exist only if such rules are generally obeyed and, when necessary, enforced. This has nothing to do with any 'will' aiming at a particular objective.

What to most people still seems strange and even incomprehensible is that in such a society the supreme power must be a limited power, not all-comprehensive but confined to restraining both organized government and private persons and organizations by the enforcement of general rules of conduct. Yet it can be the condition of submission ["it is the condition of submission of free men" makes the sentence clearer, I think, IGTU] which creates the state that the only authorization for coercion by the supreme authority refers to the enforcement of general rules of conduct equally applicable to all. Such a supreme power ought to owe the allegiance and respect which it claims to its commitment to the general principles, to secure obedience to which is the sole task for which it may use coercion. It is to make these principles conform to general opinion that the supreme legislature is made representative of the views of the majority of the people." (LLL, Volume 3, p. 134 f.)

Posted by: IGTU at Feb 23, 2007 11:13:47 AM

IGTU, that was the very first thing I asked you: whether you believe taxis and cosmos are concomitants.

2 The problems with democracy do not negate the needs for social action.

3 It is "freedom" that centralism stifles, not "spontaneous forces," which is a scientism after physics. Misplaced concreteness.

4 You write that I think "that what is bad about the system is the result of capitalism." That is wrong. Although historically, you should not doubt that capitalism brought atrocious conditions, only they got better in most areas, and partly because they were charged to do so, by movements for social justice. These got to the floor of Parliament several times. The employment of young children was knocked down from 12 to 10 hours, then 8 hours a day! How do you deny the necessity of non-market institutions, beyond those of law for property and contracts?

5 I think I'll go with the "sensationalist propaganda lies from the 19th century" of Charles Dickens. Who achieved several different kinds of social good.

6 Pareto efficiency does NOT require any certain distribution of productivity gains, (a result nicely finessed by both Kaldor and Hicks,) so therefore, the concept of "rising welfare for all" means the poor eat out of better garbage cans. Meanwhile, at the other end of town, for the same reason, there will never be a one-to-one relationship between desert and entrepreneurial creativity.

7 If humans cannot have enough knowledge to know the whole, -- which we all agree with -- if no fool can know everything, then there will NOT be a spontaneous solution to all systemic problems, BECAUSE no one could see them coming in time. Spontaneous order does NOT cause the good of systems outside of economics, and these may impinge on the economic system. We see this in our new era of natural ecological, climatological constraints. (That is why The Rise of the West does not refer to historical economic growth as "sustainable growth.") So you will need new institutions there too.

Or else, spontaneous order is communicated to you by God: Hayek's system needs a Perfect New Hayekian Man, who is psychologically identical to the New Communist Man that would make communism work.

Posted by: Lee A. Arnold at Feb 23, 2007 9:55:55 PM

Dear Lee A. Arnold,

Apologies for calling you by (what I take to be) your last name - an error of haste.

ad 2 ( = concerning your point no. 2)

While I prefer not to use the indeterminate term "social action", I agree that for democracy not to be fraught with unacceptable problems, action needs to be taken - and I have suggested the requisite direction - while I don't see what exactly you propose.

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I do not understand "scientism after physics", while - in the relevant passage - I have meant to use "spontaneous forces" in the sense of forces allowed to operate under conditions of "freedom". Your charge of "misplaced concreteness" I do not comprehend.

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I am a little uncertain regarding the expression "non-market institutions" (not knowing which exactly are meant - but I hope to have made it clear that institutions which one might regard as non-market (the separation of powers, democracy, the rule of law etc.) are absolutely essential for capitalism to work as best as it can.

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Our picture of the rise of capitalism is much tarnished by inappropriate claims and incorrect attributions of vice and misery. The rise of capitalism meant that for the first time in history one group of people found it in their interest to use their earnings on a large scale to provide new instruments of production to be operated by those who without them could not have produced their own sustenance - the proletariat was literally created by capitalism - that is: before some of the proletariat's (self-styled) representatives could later claim as a right a share in the ownership of the resources and output that had enabled them to be around at all. It created the wealth that made it possible to address more deficiencies (including those in the social realm) more effectively than ever before. It created also the resources needed to redistribute wealth injudiciously and to organize action to weaken the benefits of the market order. It keeps feeding its enemies to this day. All the great catastrophes that came upon mankind after the rise of capitalism were the outcome of anti-libertarian government action and incompatible with a freedom-based market order (breakdown of free trade that led to the I. WW, the Great Depression, the II. WW (read Keynes brilliant and very non-Keynesian account "The Consequences of the Peace") the Bolshevik Revolution, Chinese Communism etc)

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To describe the fate of the workers and low-income strata since the rise of capitalism up to this day with the words "the poor eat out of better garbage cans" is absurd. Equally absurd is equilibrium economics of the Arrow-Debreu type - which totally misrepresents the spontaneous order of the market and in its models makes a concentration camp look like the mother of all freedom, so restricted are markets and their agents under the assumptions chosen in these models.

I don't know what you mean by "a one-to-one relationship between desert and entrepreneurial creativity". My view is this: Remuneration in the market is determined by what the services offered are worth to those who wish to receive them. That's all there is to it. If I have three heads and get people to pay me a fortune to display them in shows, then I get what I deserve, irrespective of how much luck or effort may be involved. Entrepreneurial creativity may be an asset (or a regrettable liability, if I can't make money with it), but it does not represent a "desert", a foregone entitlement. One has to find out whether a product or service turns out to attract a reward or not.

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Do not misrepresent me: I clearly defined the way in which I used "sustainable growth" above.

You don't seem to have understood that a spontaneous order like the market brings forth more information than any single mind can be expected to acquire, process and act upon of its own accord. Your position reminds me of a Russian leader who thought it incomprehensible that the astounding variety of offerings in an American super-market he was visiting had not been the result of the foresight and detailed prescription of a central planner.

For a good account of the polycentric "mystery" that connects individuals to form an intelligence and effect welcome solutions no single mind is capable of see Charles Lindblom "The Market System". Incidentally, I like to think of the higher functions of the human language (those that it does not share with animal language) - the descriptive and the argumentative function (the ability to describe things and derivatively to disagree and argue over descriptions - to be in some ways analogous to prices, at least in that they allow us to produce an overarching intelligence (as manifested e.g. in the progress of science) that no single person could ever bring about alone.

It is not likely that challenges arising in any area of exceedingly high complexity (including the environment) will be dealt with more successfully by arrangements cognitively more truncated than those describable as a spontaneous order - that is true both for the ability to penetrate the issues at hand and the material capacity (the availability of means) to handle them. Try to imagine where we would stand if we had appointed a Chief of Physics two hundred years ago to make sure physics is done right. Unfortunately, we are trying to do something like that by delegating (environmental and other) issues to an unduly large extent to authorities considered capable of making a cognitive quantum leap on the strength of being elected or appointed by an elected body.

Kind regards,

IGTU

Posted by: IGTU at Feb 24, 2007 3:14:22 PM

You write, "You don't seem to have understood that a spontaneous order like the market brings forth more information than any single mind can be expected to acquire, process and act upon of its own accord."

I understand this perfectly, if you INCLUDE other non-market institutions (like retirement security transfer, the welfare system, national parks, simple criminal laws against pollution, regulation of toxic chemicals, nuisance laws, etc.) as PART OF the "spontaneous order," --in other words, if they are, or become, necessary to mitigate the bad effects (shall we say inaccuracies, or blindnesses) of the market, --then I have no difference with you.

Posted by: Lee A. Arnold at Feb 24, 2007 5:52:45 PM

And if a spontaneous order needs institutions ASIDE FROM the provisions of property for the market, then suddenly Hayek's distinction starts to vanish. Unless you start counting all sorts of things under the provisions of property. Perhaps, as Tyler Cowen asks, Hayek doesn't make sense. But that gets back to my first question: does every cosmos have taxis? Why is that?

Posted by: Lee A. Arnold at Feb 24, 2007 5:56:00 PM

Or perhaps we should say: maybe Hayek doesn't make sense on this issue, except to warn the "forces" of freedom against state ownership.

Posted by: Lee A. Arnold at Feb 24, 2007 5:58:57 PM

Dear Lee A. Arnold,

Hayek tries to understand self-generating order, which is the very subject-matter of the social sciences, the mystery that gave rise to the social sciences hundreds of years ago (roughly starting with the late scholastics) - economics, the philosophy of law, anthropology, linguistics, ethics and so on. This search for the manner in which self-organizing systems work inspired Darwin and other natural scientist to explore evolution - a concept developed by "Darwinians before Darwin" - the fathers of the social sciences. I like to call classical liberalism a cosmologically rare, maybe even unique event - namely the self-discovery of evolution. (Note, this has nothing to do with crude versions of Social Darwinism). Unfortunately, modern social scientists, especially economists, have become mesmerized by the scientific ideal of the 19th century (classic physics, most notably mechanics). Classic physics has given us tremendous power to succeed by way of taxis - i.e. by way of man-made order. Regrettably, these successes have caused many scientists to become one-sided. In the face of great inventions and discoveries made possible by natural scientists, the social scientists became the "poor relatives" of the former, developing an inferiority complex, which to this day they try to overcome with a lot of maths, econometrics and a mechanistic bend of mind (equilibrium economics is a sad case in point). See for this Hayeks "Theory of Complex Phenomena" in "Studies..." or "New Studies..."

If you want to make sense of Hayek, be clear that he - like all genuine liberal ( = libertarian) thinkers - is interested in the interplay between taxis [man made order] and cosmos [self-generating order], and how man can utilize and not destroy the power of self-generating order.

With this in mind, I recommend that you get it from the horse's mouth. "Law, Legislation and Liberty" - is one of the chief works of Hayek - and as the title correctly suggests, Hayek is dedicating a lot of effort to understanding "non-market institutions", as you put it, or the "public sector", as Tyler Cowen put it. That's why I encourage you - in a friendly way - and Tyler Cowen - in a less friendly way - to r-t-f-m - as the lady, who helps me with my computers says: read the f....... manual (especially before you review it).

Kind regards,

IGTU

Posted by: IGTU at Feb 24, 2007 8:41:10 PM

Dear IGTU,

You mention: "...polycentric "mystery" that connects indivuals to form an intelligence..." and a book by Charles Lindbloom. I am interested the the possibility that a "mind" in a real sense is formed by the connecitons formed by human interaction. Does Hayek suggest that an actual concious intellegence is formed and present in this "mind," assuming it exists? I am interested in the implications of this possibility, I would like to know if there is an existing theoretical framework discussing the apparatuses of cognition, memory, and the dimensions of individuality for such a "market mind."

Could you reccomend me some more reading (perhaps in Hayek) that explores this possibility? Is the Lindbloom book the best source on the subject? I would appreciate any input you could offer on the subject.

A further question, if such an entity exists, does it invalidate Ayn Rand's notion that "there's no such thing as society" as an entity? From one of your quotes of Hayek, it seems that he implies that questions of ethics for humans are in fundamentally different terms than the equivilent of ethics for a "market organism," which seems to at least be a way around the argument.

Thanks,
TJ Murphy

Posted by: TJ Murphy at Mar 4, 2007 6:21:26 PM

Dear Timothy (TJ Murphy),

It is difficult for me to pinpoint the meaning of your expressions "a 'mind' in a real sense" and "actual conscious intelligence". The philosophy of mind is a vast and difficult subject-matter; I can do little more than suggest some literature pertinent to your questions: As for Hayek's output, I recommend his books "The Sensory Order", "The Counter-Revolution of Science", various articles from his two volumes "Studies in Philosophy, Economics..." (I do not recall the exact titles of these two volumes) and "New Studies in Philosophy, Economics..." (including his "Theory of Complex Phenomena" and other articles of epistemological import) and always "The Constitution of Liberty" and the deepest and most complete book on the fundamental issues of the social sciences (including their epistemological implications) "Law, Liberty and Legislation".

Lindblom I mentioned only because I find the first part of the book which is concerned with the coordinative capabilities of the market order remarkably graphic - I don't seem to remember that the book is otherwise particularly concerned with the philosophy of mind.

A readable echo (and in many ways re-representation of Hayek) can be found in "Knowledge and Decision" (also epistemologically interesting) by Thomas Sowell, whose books on economics especially "Basic economics" and "Applied Economics" and Gwartney's and Stroup's textooks on economics are about the best and most one needs to know concerning the economic underpinnings (rather than wasting time doing an economics degree in the shallow, name dropping, narrow-minded and conceited environment of "everything-must-be-Economics-for-I-am-an-Economist"-types).

As for a theoretical framework, dear Timothy, you will find the above literatur useful, but also Karl Popper - especally his theory of Worlds 1, 2, and 3 (see for this also his last book with Eccles). The best introduction to Popper is his own "Objective Knowledge", from which I personally derived the ideas of a "super-human" intelligence made possible not by any individual mind but by human language and the interaction of human minds mediated by it. I was totally fascinated by Popper's idea (my reading) that objectivity does not mean "ultimate, indubitable truth" (in which way we often like to use the word) but simply "outside our own minds", "the creation of an object of critical discourse", which only man is capable of as other thinking animals are largely locked up in their subjectivity, severly limited, practically incapable of a critical exchange with other minds.

I hate to admit that I have never read Ayn Rand, but as I have implied somewhere above (in this thread), Hayek seems to be in agreement with her in that to him just or unjust conduct is a quality reserved to human beings. One may discover certain analogies between an anonymous order (such as the market) and the human mind (or other animated entities), but for the purposes of moral discernment and responsibility, Hayek is adamant that there is " as an entity". It is a recurrent theme in Hayek to warn against anthropomorphism, personification, animism - which is a main barrier against an appreciation that order and great aggregate achievements (economic coordination and wealth, scientific progress, cultural and civilizatory advancement) may come about as a consequence "of human action but not of human design" and that the more complex an order is the more likely will it be the outcome of spontaneous processes rather than the realization of a blueprint.

Kind regards,

IGTU

[1] Miscellaneous Contributions to A Debate on Spontaneous Order

Dear Timothy,

Recently, I met one of Germany's leading brain researchers. The guy was pretty unhappy about the resonance to his conclusions from long-standing research. One of his major insights is that there is no location of the "I". Personality, sense of identity, intelligence seem to be the outcome of vast interactive processes in the brain (and of course, between brains and the brain and its non-cerebral environment). So, on this level, too, it appears misleading to look for a single repository of intelligence, personality, identity etc. It is more fruitful to search for the way in which multifarious elements work together to form an outcome that it is tempting but wrong to regard as the result of a central agent. The resistance that this researcher is facing from his colleagues seems similar in nature to the unwillingness to accept that a powerful free economy or, indeed, a great society is the result of interactions so varied and complex that no single mind could bring them about, while people, who follow their own knowledge for their own purposes can - so long as they heed general rules instrumental in maintaining a decentralised order in which experimentation and utilization of dispersed knowledge is carried out with much greater effect than would be possible if people were restricted to acts ordained by a central authority.

I seem to remember that the brain researcher discovered no striking differences in the functionality of parts of the brain found both in animals and human beings, except that human beings had "more of the same" - which triggered in me the intuition that the brain may be in some important respects like a market. The larger it is, the more extensive it is, the more powerful the outcome - the range of fruitful associations expands, the range of yet unknown, potentially beneficial permutations open to discovery is larger - there is more to be discovered, more hidden goods and more hidden good available for the seekers.

(Also, compare two peoples - as in North and South Korea - consisting of fairly similar human beings and enjoying comparable environmental circumstances, except that one people is not allowed to benefit from markets while the other is. Those with markets engender far more intelligent solutions in terms of the satisfaction of needs.)

This might suggest that a quest for the "authorship" of intelligence, that the notion of a "mind" or other "entity" encapsulating intelligence may send us in the wrong direction. And that we will learn more about the phenomenon if we focus on the decentralized production of it and the rules of interaction which bring together the countless contributors to intelligence.

Relatedly, there are rules of conduct which will further this beneficial decentralized production, while other rules or more rule-less patterns (compare: consistent protection of property vs. insecure property rights) will cramp intelligent outcomes. The distinguishing stance of classic liberalism is that it favours reliance on rules (protecting individual freedom and benefiting from a vaster market in intelligent solutions) rather than authoritarian ruling (which subjects the community to the power of a necessarily narrower intelligence, the intelligence of the few who command the many).

The insight that by obeying certain impartial rules consistently we can achieve a far richer society than by following the partial decrees of a governing body (representing a very narrow cross-section of individual knowledge and preferences) is so young compared to the history of human beings that it is still perceived by most as counter-intuitive, implausible and not credible - even though most of the advances made by man in the past few centuries are due to a spontaneous order (consider world markets or the progress of science) capable of enhancing and utilizing the benefits of decentralized production of intelligence. Misery (look at Africa) and decline (look at the forceful suspension of free trade after the WW I) put in an appearance when such a spontaneous order is forced to retreat, destroyed or not allowed to develop.

This is what Hayek called the "fatal conceit", the dangerous illusion that large societies can be directed like a tribe by a leader and his visions of immediate expediency, rather than understanding that they can be maintained only by careful cultivation of general rules designed to protect and further the resourcefulness of every member of society.

Kind regards,

IGTU