Libertarian Roots Revisited

The Liberty Tree in Boston. Wikimedia Commons.

In my last two essays, I looked first rightward and then leftward for insights into the challenges we face and how best to surmount them. Now I’ll look back at my old intellectual home, libertarianism. Although its relevance to contemporary problems has been in decline so far in the 21st century, when I look toward the longer term, I get the sense that at least some of my old libertarian instincts will prove to be vitally important in steering us away from catastrophe and toward a flourishing future.

It usually begins with Ayn Rand — so wrote Jerome Tuccille in his 1971 book by that name about the early days of the libertarian movement. Well, that’s how it was for me. In the summer of 1978, between sophomore and junior years in high school, I read Atlas Shrugged at the recommendation of my parents. I was immediately hooked: I soon gobbled up everything she had written and started thinking of myself as a “student of Objectivism.”

So why did I respond so positively to Rand? Looking back, it seems overdetermined. On the purely personal level, I had spent much of my middle school years getting picked on for being the smart kid, so a revenge fantasy in which the smart kids grew up, went on strike, and brought the world crashing down around them was pretty irresistible. More broadly, the one thing everybody agreed on in the 70s was that things were falling apart; the euphoric bender of the 60s had been followed by a crushing hangover. For me the contrast was especially vivid: in my boyhood we walked on the moon and planned to settle the solar system, while by my teenage years we were told there were too many people and not enough energy and the future would be one of limits and shortages and retreat. So reading Rand’s account of how the principles behind communism — which I had been raised to see as pure evil — were spreading around the world and robbing us of our future, I now had a compelling answer as to what had gone wrong. Instead of gloomily looking out on a mysteriously broken world, it now seemed to me that I had been born in the midst of a great, world-historical struggle. And I wanted to spend my life in the fight.

My Ayn Rand phase lasted through college. Interestingly, it was an encounter with Edmund Burke that marked the beginning of the end. I was a history major at Princeton, and I did my senior thesis on the political philosophy of Thomas Paine. (The puzzle I was trying to solve: how could someone who came across so fiercely libertarian end up as one of the early advocates of the modern welfare state? Needless to say, this seems less puzzling to me now.) I remember diving into Burke’s Reflections on the Revolution in France (to which Paine famously responded with Rights of Man), eagerly anticipating collecting a trove of howlers that Paine would blow out of the sky. But I was stunned to find, not some obscurantist rejection of reason and celebration of blind faith, but rather a surgical use of reason to dissect and expose the limits of reason in remaking society from scratch. (To be fair, I did find some howlers as well, like his maudlin tribute to Marie Antoinette.)

The next fall, starting law school at Harvard, at the urging of my classmate David Frum I read F.A. Hayek’s The Constitution of Liberty. I had taken a look at Hayek in college, but still a red-hot Randian I found him far too “wet” for my taste. Now, with Burke having softened me up, reading Hayek was an electric experience. Here was a case for the free society on philosophical grounds almost diametrically opposed to those I had been occupying. According to Rand, starting with self-evident axioms we can deduce our way with rock-solid certainty to the moral superiority of laissez faire capitalism. Hayek, by contrast, argued for freedom on the basis of our ignorance: the workings of society are far too complex and far too dependent on trial-and-error evolution for any blueprints for total social reconstruction to be trusted. Seeing that case laid out, it immediately struck me that Hayek’s critical anti-utopianism made a much firmer foundation for my political ideals than Rand’s swaggering certainty. Over the course of law school, I read virtually everything he had written as well as many of the authors he cited (Hume, Tocqueville, Acton, Karl Popper, Michael Polanyi, Michael Oakeshott, etc.).

By my mid-20s, then, I had assumed the political identity I would hold for the next two decades: a Hayekian “classical liberal.” I had never been tempted by anarcho-capitalism (it always just seemed wacky to me), and now I dropped the insistence that government be confined to the “minimal state” of courts, police, and national defense forces. Seeing some ground for light regulation and a modest safety net, I nonetheless considered the contemporary welfare state to be a run-amok Leviathan in need of dramatic downsizing. In my mind, the central political challenge of our time was devising workable restraints that could keep the state from overwhelming society.

Out of law school I went into private practice and wandered into the field of international trade regulation, defending foreign exporters from complaints of “unfair trade” under the U.S. antidumping and countervailing duty laws. It was a great fit personally: I got paid well for following my free-trade convictions, plus I got to travel all over East Asia meeting with clients. (I ended up doing more work in Thailand than anywhere else. That’s how I came to fall in love with the country and launch the chain of circuitous events that led me decades later to move here.)

But I never had any intention to stay in private practice for my whole career. I didn’t know what I wanted to do — work on Capitol Hill, or on campaigns, or in a think tank — but I knew I wanted to be in the fray. As soon as I got out of law school, I started writing op-eds and magazine articles and book reviews for conservative and libertarian publications, getting rejected regularly but eventually building up a nice portfolio of published writing. On the strength of those efforts I got a job at my favorite think tank, the Cato Institute – first helping Bill Niskanen to edit Regulation magazine; then later, after a few years back at my old law firm (it’s a long story — I decided I hadn’t fully scratched the lawyer itch), as the director of Cato’s new Center for Trade Policy Studies. As my interests and organizational responsibilities broadened, I became Cato’s vice president for research.

Over the course of the new century, though, my libertarianism gradually unraveled. Becoming familiar with the shocking extent of mass incarceration and U.S. outlier status in this regard led me to a broader appreciation of the continuing legacy of slavery and Jim Crow — and ultimately to a clean break with the libertarian insistence that only government coercion (and not cultural norms) can create unfreedom. Around the same time, the increasing prominence of the debate over income and wealth inequality forced me to recognize that a rising tide wasn’t lifting all boats in the way that I expected. And my growing disgust with the incompetence of the George W. Bush administration — especially due to my tardy but eventual recognition that the Iraq War had been a dreadful mistake — and the increasingly illiberal anti-intellectualism of conservatism caused me to stop seeing myself as located on the political right.

I was born in the Deep South and my parents had been fervent Goldwater supporters: my very first memory is being teased by cousins for wearing an “AuH20” cowboy hat after he had lost. My first independent political opinion was breaking with my parents, who dutifully supported Ford, and rooting for Reagan in the 1976 nomination fight — I didn’t want to give back the Panama Canal! I cast my first vote for Reagan for president as an 18 year-old freshman in 1980, and from then through the 2004 election I don’t believe I ever voted for a Democrat (and I don’t think I’ve voted for a Republican since). Yes I was a libertarian, but I was also a Cold War hawk (as was Rand, in contrast to most libertarians), so while I never cottoned to social conservatism I so strongly favored the GOP on economics and foreign policy that I was able to overlook what generally seemed to me to be lip service to the religious right.

Especially after my belated opposition to the Iraq War, that calculus changed as my larger foreign policy position shifted away from hawkish conservatism. At around the same time, the collapse of Bush’s plans to partially privatize Social Security convinced me that a major overhaul of middle class entitlements was politically hopeless — and that the GOP wasn’t up to pulling it off even if the votes were there. The limited-government agenda had basically shriveled down to rote support for cutting taxes — and I came to see that what was called “starving the beast” actually encouraged higher spending by reducing the marginal cost of government. So my attachment to conservatism’s economic agenda weakened substantially. Meanwhile, the FoxNewsification of the GOP base was now well underway, and it seemed like all the energy on the right had shifted toward anti-intellectual and illiberal populism: the turn against immigration, the embrace of torture, the obsession with gay marriage, the Terri Schiavo debacle, and on and on. Honestly it all seems so quaint and tame now compared to how things have degenerated, but by 2006 I saw populism taking over the right and I knew I wanted no part of it.

Having intellectually disconnected from the right, it was now vividly apparent to me how much the libertarian movement — which styled itself as beyond left and right — had been shaped and indeed deformed by its long cohabitation with conservatism. And so, without fully realizing what I was doing at the time, I started wandering away from my intellectual home of the past twenty years in search of something new.

My first foray into heterodoxy was a piece I wrote for The New Republic at the end of 2006 that a clever, anonymous headline writer titled “Liberaltarians.” This idea for a new intellectual synthesis – “a movement that, at the philosophical level, seeks some kind of reconciliation between Hayek and Rawls,” as I put it in that piece – started me down the path that leads to where I am today. Tensions between me and Cato’s senior leadership grew to the point that I left in 2010 for the Kauffman Foundation. A board coup at Kauffman, though, ousted the president who hired me and left me without a future there, so by 2012 I was back at Cato, where I tried to stay out of trouble by focusing on the 21st century slowdown in economic growth. My search for a liberaltarian approach to the problem led ultimately to my teaming up with Steve Teles to write The Captured Economy.

Then came Trump, and my deep discomfort with the extent to which some Cato scholars and lots of Cato donors went happily along for the ride. In the wake of the election, the Niskanen Center — founded by my longtime Cato colleague and friend Jerry Taylor — decided to start an “Open Society Project” to counter the rise of authoritarian populism here and abroad. Jerry asked me to direct it, so in the summer of 2017 I moved to Niskanen. I still thought of myself as some kind of modified libertarian when I got there, but it wasn’t too long before I decided the label no longer really fit.

In retrospect, my own intellectual journey synced up quite nicely with that of the larger world. Assigning beginning and end dates to historical periods is always an exercise in false precision, but it can’t be too far off to say that the neoliberal era began in 1978 with Deng Xiaoping’s reforms and ended thirty years later with the global financial crisis. My own personal libertarian era also began in 1978, and by 2008 I was already running with the liberaltarian heresy that would eventually carry me away from libertarianism altogether.

The upshot is that I spent the bulk of my professional life trying to advance a creed I no longer hold. How do I make sense of that now? My take is that libertarianism is in possession of some important partial truths — in particular, that competitive markets are an astonishingly useful social technology, entrepreneurial trial-and-error is essential to driving economic innovation, governments can fail badly even when backed by the best of intentions, and state power can use the cover of good intentions to commit horrors. The fundamental error of libertarianism is mistaking these partial truths for the full truth. (For my more detailed thoughts on where the libertarian movement went wrong, check out this trio of essays.)

When libertarianism burst onto the scene and rose to prominence during the 1960s and 70s, the partial truths championed by libertarians had become highly underrated. One-third of humanity lived under regimes dedicated to the proposition that private property and markets had no role in economic life, enormous welfare states and regulatory edifices had been constructed in the advanced democracies, and the smart set spied a future where East and West would converge as the communist bloc gradually democratized and the capitalist bloc gradually socialized. In these circumstances, the growing prominence of libertarian ideas was at the very least a useful thermostatic corrective. By the dawn of the 21st century, though, the alignment between the partial truths of libertarianism and the challenges of the day had slipped considerably. Climate change, a deepening class divide, a slowdown in economic dynamism in part due to declining public investment in R&D: although there are certainly particular libertarian-friendly policies that are part of an effective response to all these problems, in broad brush it’s difficult to look at the world’s major problems today and see “make government smaller” as a plausible summary of what needs to be done. Libertarian ideas are sometimes useful tools for improving the liberal democratic capitalist welfare state, but there are lots of other important tools that need to be in the box as well.

So that’s the story of how libertarian ideas changed my life, and how I gradually wandered away from the faith. But here’s the twist: as I look out into the farther future and try to make sense of the fundamental, long-term challenges that confront us, I see one of libertarianism’s partial truths growing in relevance. Indeed, I think that it may well end up assuming decisive importance, ultimately defining the difference between “living wisely and agreeably and well” and slipping into dystopia. This partial truth is the one I take to be the ur-libertarian idea, the fundamental impulse behind the entire ideological construction. Here is its most famous formulation: “Power tends to corrupt and absolute power corrupts absolutely.”

Contemporary libertarians focus their suspicion of centralized power exclusively on the state and its coercive powers, and I agree that is where the most acute danger lies. But as I wrote recently, the unhealthiest concentrations of power in contemporary democracies are not those of political power within the state, but those of broader social power within the professional and managerial elite that controls both public and private sectors. In our post-industrial information economies, talent and resources and initiative and influence have become heavily concentrated within the top 20 percent or so of society — and the elite itself is as top-heavy as the overall society. 

This isn’t the kind of power imbalance that contemporary libertarians have eyes to see, but Tocqueville’s description of the soft despotism possible under democracy is hauntingly apt. Such a despotism doesn’t “torment,” but rather “degrades”; it “does not destroy, but it prevents existence; it does not tyrannize, but it compresses, enervates, extinguishes, and stupefies a people, till each nation is reduced to be nothing better than a flock of timid and industrious animals, of which the government is the shepherd.” I don’t think it’s too much of a stretch to see the malaise gripping the United States and other advanced democracies in the 21st century as the discontents of mass learned helplessness under an “immense and tutelary power” — societies in which the capacity to control one’s own life and shape one’s own community has been gradually drained away by outsourcing to the market and the state.

I fear that the inertia of contemporary trends threatens to carry us toward worse forms of despotism, with a central authority that torments as well as degrades. On the one hand, it seems likelier than not that the ongoing progress of AI and automation will work to further marginalize ordinary workers, and that consequently their dependence on government for income support — perhaps in the form of wage subsidies, or a universal basic income — will grow. Meanwhile, that same progress in AI and automation is giving new, expanded powers to governments to monitor and manipulate not only people’s actions but their thoughts and feelings as well. And both of those trends are playing out in the advanced democracies against a backdrop of ongoing social disintegration. With the center driven by an imperative to bring everything under expert managerial control and a periphery plagued by demoralization and dysfunction, the temptation of central authorities to use a firmer hand to push back against the chaos of social breakdown may prove difficult to resist. Meanwhile, in the larger world there is ample reason to worry that the current global democratic recession will be long-lasting.

I can think of no stouter defense against such dismal possibilities than a successful “economic independence” movement along the lines I have been advocating on this blog. As I put it in an earlier essay:

A successful economic independence movement, by contrast, offers a path to a more inclusive society in a way that reduces exposure to domination from all sources. Greater self-sufficiency at the household and local levels creates a measure of freedom from the system as a whole — that is, from both the market and the state. And I would argue that, for any society with a sizeable percentage of the population enjoying such material independence, the prospects for maintaining freedom for everyone in that society would be brightened considerably. Independent sources of income and wealth translate into independent social power, and therefore political power with which to check the expansion of government control.

When I first introduced this idea of an economic independence movement, I presented it as a response to capitalism’s crisis of inclusion. The labor market is failing to provide a path to flourishing for most people, as the importance of ordinary workers’ economic contributions has been marginalized by automation and globalization. Meanwhile, the personal connections to family, faith, and community that are so essential to flourishing are weakening as well — in large part because these face-to-face relationships have been drained of their functional significance by outsourcing to the market and state. In response to these ills, I’ve proposed giving people an alternative pathway to flourishing outside the labor market by making it possible for households, neighborhoods, and communities to provide more for themselves – and in the process revitalize their personal relationships by reconnecting them to practical functions.

When presented this way, the idea of an economic independence movement comes across as a communitarian initiative, and indeed that’s a fair characterization. Yet at the same time, the dramatic decentralization of economic and social life made possible by such a movement can be seen as libertarian: a society in which domination from the center has been significantly rolled back is a freer society.

Here it’s useful to introduce libertarian political theorist (and Niskanen senior fellow) Jacob Levy’s distinction between rationalist and pluralist liberalism — a distinction that runs throughout the greater house of liberalism, including the libertarian wing. In his book Rationalism, Pluralism, and Freedom, Levy argues that the larger liberal tradition comprises two conflicting strains: rationalism, or the belief that rights are best protected by a common set of rules applicable to all; and pluralism, or the belief that the defense of liberty depends primarily on the existence of robust intermediate groups (families, churches, unions, community organizations) that interpose themselves between individuals and the central authority. According to Levy, these two contending strains are ultimately irreconcilable: the more robust the rights of free association in intermediate groups, the less possible it is to guarantee equal treatment for all. The greater powers you give the central authority to combat unfreedom from below in the form of oppressive smaller groups, the greater the vulnerability to unfreedom from above in the form of the central authority’s abuse of its expanded powers. We can never achieve a full and stable synthesis; the best we can do is maintain some kind of uneasy shifting balance.

Another libertarian political theorist, Chandran Kukathas, has fleshed out the rationalist and pluralist variants of the radical libertarian ideal in a fascinating essay titled “Two Constructions of Libertarianism.” For the former, he posits an ideal polity known as the “Union of Liberty”; for the latter, the “Federation of Liberty.” Both polities are founded on the libertarian principle that no person may use or threaten physical violence against the person or property of others. They differ markedly, though, in how they deal with the people in their society who don’t accept libertarian principles. In the Federation of Liberty, they are allowed to form communities and live as they wish, provided they do not aggress against others outside their community. Within their communities, they may have any rules they want, including even practicing slavery. When people in such illiberal communities have their rights violated, they can leave if they’re able, but there is no general right to defend the rights of others. Within the overall federation, then, there may be a great deal of unfreedom within communities, but between them “free trade with all, but entanglements with none” is the rule.

In the Union of Liberty, on the other hand, no one is free to violate the principles of libertarianism. If you don’t accept them, you are of course free to waive your rights in conjunction with others’ waiving theirs, so voluntary associations that deviate widely from libertarian principles are possible. But no one can sell himself into slavery, so people are free to break their contracts and pay appropriate compensation when they no longer wish to belong to any association. Of course, since this is a society of human beings, rights violations occur regularly, and so a strong central authority has been established to determine when rights are violated and what responses are appropriate. And once a strong central authority exists, it’s vulnerable to being captured by the most powerful groups within society — at which point the guarantor of freedom can be used to extinguish it instead.

Kukathas declares his preference for the Federation of Liberty — in the end, because he worries more about creeping unfreedom from above than even widespread unfreedom from below. “The case for the Federalist position is grounded in a conviction that power ought not to be entrenched,” he argues. “No power should be established as the final court of appeal from which no dissent is possible. Indeed, if anything is fundamental to libertarianism, it is the conviction that dissenters are tolerated or allowed to go their own way – free to exit from arrangements they find intolerable themselves.” (For those interested, Kukathas develops his pluralist conception of a free society at book length in The Liberal Archipelago.)

When I first read this paper a decade or more ago, I strongly preferred the Union of Liberty — or a watered-down version of it, at any rate. Now, however, I see that rationalist ideal as neither viable nor desirable. My grounds for rejection, though, are the opposite of Kukathas’s: he worries that the Union will lose its pure libertarian character, while I no longer see the Union (or a slightly lower proof version of it) as a worthy goal at all. Under the conditions of modern society, there are far too many external effects and other collective action problems for a barebones state to be able to provide the regulatory structure and public goods on which prosperity depend. Beyond that, there is the additional obvious and insuperable obstacle: the vast majority of people aren’t libertarian and would never support such a radical overhaul of society.

While the rationalist ideal of the Union has lost its luster for me, the pluralist project of moving toward something like a Federation of Liberty now holds real appeal. Not, to be sure, the full-on radical version that Kukathas endorses: if a minimal state is unworkable under modern conditions, the lack of any central authority at all is preposterous. But a devolution of substantial rulemaking authority to local communities fits together well with a movement toward greater local economic independence. As I wrote in an earlier essay:

Think of a 21st century version of the Homestead Act, giving people the resources they need to build new and better lives on their own. An extensive list of technological missions relevant to achieving human-scale abundance could be developed, and people seeking to found new communities could apply for support with plans for advancing this or that mission…. For a 21st century Homestead Act to realize its full potential, it will need to provide not only resources and financial support, but also the necessary legal and regulatory flexibility to try out new technologies, building and production methods, and social arrangements. In other words, it should follow the example of the charter cities movement and allow the experimentation conducted in pioneer communities to extend to governance.

A successful economic independence movement, with a growing archipelago of tight-knit communities featuring a high degree of material and legal independence, would greatly alleviate the alienating, enervating top-heaviness of contemporary society. It would, furthermore, act as a powerful bulwark against top-down overreaching by the state.

But more than providing remedies and insurance against bad outcomes, the decentralization of society achieved by an economic independence movement would significantly enhance our chances of learning to “live wisely and agreeably and well.” As the political philosopher Robert Nozick observed in the closing section of his libertarian classic Anarchy, State, and Utopia, taking the idea of utopia, or the “best of all possible worlds,” seriously requires us to reckon with the fact that there is widespread and enduring disagreement about what such a world would look like. “The conclusion to draw,” he wrote:

is that there will not be one kind of community existing and one kind of life in utopia. Utopia will consist of utopias, of many different and divergent communities in which people lead different kinds of lives under different institutions. Some communities will be more attractive to most than others; communities will wax and wane. People will leave some for others or spend their whole lives in one. Utopia is a framework for utopias, a place where people are at liberty to join together voluntarily to pursue and attempt to realize their own vision of the good life in the ideal community but where no one can impose his own utopian vision upon others.

The word “utopia” makes me uncomfortable, as it is usually associated with a one-size-fits-all vision whose combination of uniformity and changelessness is in my view antithetical to human flourishing. But Nozick’s “utopia of utopias” is a different beast altogether: it is, I believe, an important elaboration on what it means to “live wisely and agreeably and well.” The key point is that there is no one kind of society that could live up to that standard by everyone’s lights. “But if there is a diverse range of communities,” Nozick wrote, “… more people will be able to come closer to how they wish to live, than if there is only one kind of community.”

It's clear enough that a “utopia of utopias” doesn’t live up to anybody’s idea of an ideal society. With a more robust commitment to pluralism, it will be virtually guaranteed that, from almost everybody’s perspective, there will be lots and lots to disapprove of.

But a society that is ideal by everybody’s lights isn’t on the table: it doesn’t exist because it can’t. What is possible, though, is keeping dystopia at bay while preserving the possibility that, over time, more and more people can come to find their own version of the good life. To succeed in that ambitious but realistic objective, I believe that our best bet lies in a greater commitment to pluralism. And my confidence in that judgment — in believing that a new synthesis of capitalism balanced by economic independence is worth pursuing — is bolstered by the fact that what at first blush looks like a communitarian idea can be supported on libertarian grounds as well.