Frank van Dun, "Philosophical Statism"

Statism and the State

A. The Failure of Statism

It is time to interrupt our visit to the city of statism. We certainly did not visit every one of its houses and hovels; but we did stop at some of its magnificent palaces. Everywhere we got the same message: neutrality is not an objective of the state; on the contrary, the state’s ambition is, or should be, to put an end to the metaphysical sickness of private judgement, at least among its own personnel or with respect to all politically sensitive actions, and ideally in all spheres of social life. We know that Rousseau did not believe this ambition was worth pursuing, except on those necessarily rare occasions, most of them in the distant past, when all the conditions are favourable. We also know that Plato was pessimistic about the chances that a wise ruler would succeed in establishing a durable regime of loyal guardians contented with an ascetic life of service.²⁸ It seems to me that, before the nineteenth century, philosophical statism was more often presented as an ideal solution that should guide political reforms, but only if there was any chance of success; however, as most of the time there is no chance of success, the counsel of prudence is to shelve the statism and so stick to a conservative programme of maintaining law and tradition.²⁹

In retrospect, and judged by its own criteria,³⁰ the statist project has been a failure. The spectacular growth of the state, especially since the last quarter of the nineteenth century, has not been accompanied by the emergence of the sort of guardian of society, citizen or New Man that Plato, Rousseau or Marx thought necessary to legitimate the social chains of statehood. Instead we have witnessed the emergence, acknowledged even by the social sciences, of politicians, bureaucrats and rent-seekers. All the positions that should have been occupied by dedicated, unselfish, even ascetic, civil servants, are filled with precisely the sort of unreconstructed human material the theory declared unfit for a well-ordered state.

The rhetoric of guardianship and citizenship is still very much in evidence, especially in the press and the other mass-media where it allows columnists to produce “responsible comment” at low intellectual costs, and, of course, in the schools. The rhetoric has a hollow ring: it provides a convenient set of formulas for use in public discourse, but no one takes it too seriously as a guide through the complexities of daily life. Politicians, the masters of public discourse, appreciate it enormously. If it is their mission, as guardians of the state, to recast the raw human material in the mould of the citizen, they should not have any scruples (other than those of electoral or financial expediency) about using state power to make people behave. Most of the time, however, when politicians use it, the rhetoric sounds like a pathetic complaint about how “uncooperative” people are, especially when it comes to paying taxes and complying with regulations. People never seem to get the idea that a good citizen is really an unpaid civil servant. The citizens themselves, mere human beings, also sing the praise of citizenship; only to them it means no more than common decency. They think they behave like a good citizen even as they move through life in almost complete ignorance of or disregard for the multitude of regulations that apply to them.

If we restrict ourselves to the far less metaphysical theory of statism advanced by Hobbes, the verdict of failure still stands. While the state is in a sense more powerful than ever before, it is in control of very little. Yet, effective control was the Hobbesian rationale for the concentration of power in the hands of the state. The best we can say is that an extraordinary amount of movement proceeds through the sovereign. The sovereign should have been at the top of the power-structure, occupying a place where everything comes together. In reality hardly anything comes together.

Except for the, in most cases, merely formal check at the time the budget is drawn up, no procedure exists for co-ordinating policies. Interest-groups of various colours and stripes are often successful in their attempts to influence, even capture, political and administrative decision-making processes. Dropping their specialists in every major party, they are directly represented in parliament, in its committees, and often enough in the cabinet. If they do not succeed in writing suitable regulations, they still influence the implementation of policy. The name of the game is getting the state to work for you at the expense of whoever happens not to be watching. In Hobbesian terms, the war of all against all continues to rage, except that it is now called “politics as usual.” Why did philosophical statism fail when so many great minds have spent so much energy in elaborating it? The easiest, and probably most convincing, answer is that it built on the wrong foundations. In one form or another the Hobbesian axiom, that war is the natural condition of mankind, underlies all of the statist theories. There may be reservations about whether this natural condition is also the original condition, or whether mankind at some point became alienated from its original nature, lost its innocence, and dissolved into a mass of separate groups and individuals. Nevertheless, whether it postulates an original long-lost unity or not, statism looks forward to unifying society under a single rule of life. It aims at overcoming the separateness of human persons and all it implies: independent decision-making, diversity of opinion, rivalry, self-interest, and ultimately all manifestations of individuality in social relations.

Statism is at bottom a revolt against nature, a refusal to accept what to others is simply an unalterable fact of nature. In this alternative view, originally elaborated by the Sophists and other radical naturalist philosophers of the fifth century BC, human beings survive in this very real world by means of their social skills, their ability to instill respect for the requirements of society by appeals to the sense of honour and shame (aidoos) and by insisting on the need for negotiations, arbitration and impartial judgement (dikè). That is to say, people learn to develop rules and conventions for living with and alongside one another, without sacrificing their individuality. The secret of social order is accommodation, not unity. Accommodation takes place in a horizontal plane, where people meet one another, exchange goods and ideas, and then move on to other meetings, other exchanges. Every meeting is a local and temporary affair, preceded and followed and surrounded by countless other meetings involving countless other people. Only memory and anticipation can integrate these meetings into recurring flexible patterns of social behaviour. There is no point above the horizontal plane of human action from which everything can be seen in its totality, let alone controlled. Unity, in contrast, presupposes a vertical dimension, it presupposes just such a point above the plane from which everything, no matter when or where, can be seen, comprehended, and controlled. As long as people thought this point above the plane was reserved for the gods, it symbolised man’s humility and fallibility in the face of an unobtainable scientia divina. The pretence to rise above the plane of human existence could only be interpreted as self-defeating hubris. However, the metaphysical strands in Western philosophy as well as some forms of religious mysticism taught man would not be complete unless he attained that position. The knowledge of all things would then be his, and as it is the same for all, it would unify mankind and end all strife and rivalry. Statism, I submit, is but a translation of this teaching into the language of action and power.

The failure of statism leaves us with a state that embodies all that the statist philosophy abhors.³¹ That state is not a unity made possible by an integration along a vertical axis, because no such axis exists or can exist. Rather, the state exists, like all human things, in the horizontal plane. The appearance of verticality is illusory. What creates the illusion is the psychological need to come to terms with the state’s ability to do with complete legal impunity and as a matter of daily routine what would immediately be stigmatised as criminal if a “private person” or “ordinary citizen” were to attempt it. This ability is a direct affront to the common principles of law. These have their origin in the requirements of life in the horizontal plane. Consequently, there is no way in which to look upon the state as part of a just order, other than to suppose that it answers to a higher law (i.e., to an order of existence which is not bound to the natural conditions of human existence). On the other hand, if the state is viewed as part of life in the horizontal plane, it appears as nothing more than a particular organisation for satisfying human needs and desires. Far from delivering mankind of the curse of private, and therefore incomplete and unreliable judgement, it makes private judgement the source of “public action.” Public action is action that is not bound by the common principles of law. For the statist, such action would be proper only if it issued from a “public judgement.” It does not.

B. The Corrupted State

The consequences are grave. The rise of the state has made it possible for an ever increasing number of persons to accomplish their ends without regard for law. The requirements of society count for very little in an intellectual climate dominated by the belief that there is no such thing as natural society. So all attention is diverted to the requirements of particular societies (states), that is to say, to setting collective goals and mobilising the means to attain them, regardless of law. Leaving aside what the ideal but non-existent guardians, civil servants or New Men would do with such a formidable tool, there is little doubt that to ordinary people it is a standing invitation to try to put the machinery of the state and its enormous “public powers” at the service of their own interests. Who can afford to decline the invitation? Who can afford to be left behind in the political rat-race?

Modern apologists of the state like to invent one social dilemma after another to vindicate their belief that people in society are impotent to solve their problems of co-ordination and cooperation.³² The apologists think they have proven their case when all they have demonstrated is that, if he were to exist, their fictional “mortal god” would solve the problems. The real state, however, exists in the horizontal plane and has no advantage except force. There is nothing magical about this force: it is force supplied by people and used by people against people in order to get what they want at the expense of the less powerful. If the power grows to be effective, everybody will want his piece of the action; but if everybody does, no one will like the outcome. This is the “social dilemma” all over again, only this time it does not prove the impotence of lawful society, but of the state itself. It creates the very nightmare statism was designed to ward off. The apologists are blind to fact that the mere existence of the state multiplies and intensifies their vaunted social dilemmas.³³

The process generated by this political dilemma exhibits a perverse dynamic of social destruction, a steady depreciation of the social skills. Respect for law forces people to co-operate, to assume full responsibility for their actions, to face the risks and costs their decisions entail. The “need” for political power, on the other hand, is never greater than when the objective is to get what one cannot get lawfully. It is never greater than when the objective is to get out from under one’s lawful obligations and to shift one’s responsibilities onto unsuspecting others. The “legitimacy” of the use of state power sanctions any “winning coalition,” no matter what it wants, as long as it is smart enough to conjure up a “crisis.” Any crisis will do. The perverse dynamic ensures that crises are never in short supply.

The political merry-go-round never stops, it goes faster with every spin. Critics may explain the “atomisation of society,” the emergence or re-emergence of a “dual society,” by referring to the regulatory labyrinth of the welfare state, its incomprehensible tax laws and catch-as-catch-can fiscal policies, its jealously guarded monopolies over monetary and jural institutions.³⁴ They may point out that, when business finds itself between the anvil of consumer choice and the hammer of discretionary regulatory and fiscal powers, economic competition is bound to become ugly. However, rather than face up to the realities of what Ludwig von Mises called “the hampered market,” we are incited to complain that the hammer is not heavy enough and pour money into smoke-screens such as “business ethics.” Whatever message the critics send, the message received will be interpreted as a call for new and vigorous political action by the wise guardians of the state. Every critique of present conditions is automatically translated into a call for more guardians and better citizens. The axiom of statism, that left to itself society will disintegrate, allows no other conclusion.³⁵

Conclusion

Where do these considerations lead us? The state, especially the welfare state, is not neutral to personal moralities. There is no doubt about that. Should the state be neutral to personal morality? A timid answer would be; that it should if it could, but that, as it can’t, we should not insist. However, we saw that a number of the greatest thinkers in the statist tradition denied that there was any value in personal moralities. They wanted the state to be a condition of life in which the need for a personal morality would not arise—a condition in which one will, one judgement, would direct all activity. While statism, considered as a programme for state builders, has unquestionably failed, the rhetoric of statism (and its corollary: citizenship) continues to be a strong and intimidating force in public affairs. It is still used to urge people to measure themselves and each other against the mirage of the true guardian, the true citizen, the true Social Man.³⁶ It is utterly naïve to expect neutrality from the state.³⁷

So where do the misgivings about a lack of neutrality come from? Neutrality, I argued, is a characteristic of law. I also argued, that “law” and “state” stand for completely different conceptions of human society. It seems reasonable to conclude, therefore, that misgivings about the lack of neutrality in the welfare state betray a deep sense of uneasiness about the present form of organised lawlessness. If law is indeed the requirement of social existence, that uneasiness is eminently justified.

Notes

1. The author would like to thank Prof. Erik Schokkaert of the Catholic University at Louvain who commented on the paper at the Hayek Symposium in Ghent (March 17, 1995), and kindly made his comments available to him in writing. Some of his comments as well as replies to them are included in the notes.

2. This question was the title of the second section of the Hayek Symposium (held at the University of Ghent, March 17, 1995). Since I do not believe that the question of moral neutrality arises only or in a special sense with respect to the welfare state, I shall not pretend that it does.

3. The phrase “a personal morality,” as used here, refers to a personal commitment to some vision of what makes one’s life good and worthwhile, a code of conduct, or a particular set of values. I make no a priori assumptions about the sources of this commitment, nor about the particular content of the morality in question. However, it is necessary to assume that a personal morality does not require the person holding it to [attempt to] force others to accept it. Erik Schokkaert comments that he is “afraid that in this definition there is no room for values of ideas about the basic institutions of society.” (On the contrary, the definition leaves plenty of room for such views and plenty of scope for voluntary institutions—or are we to understand that basic institutions must be coercive?) Schokkaert continues: “conflicts between private moralities are unavoidable . . . The whole point of politics is to try to find agreement about these matters without necessarily resorting to violence.” However, the point of the state is that one solution should be forcibly imposed, even if there is no agreement. Remarkably, Schokkaert then says that he does not “see [a] problem with the introduction of, e.g., a collective insurance system, if this would be unanimously accepted, i.e., is a Pareto-improvement in my preferred jargon.” However, all insurance systems are collective, even if they are not all coercively imposed. In a free market an insurance scheme is unanimously accepted by all participants, and is therefore likely to be a Pareto-improvement to them. That is not true for an imposed system which permits one party [the government] to unilaterally change the terms of insurance afterwards, and, more importantly, to enforce a no exit clause (which no reasonable person would accept in the first place, especially if he had any regard for his children or the next generation).

4. The contributions of professors Theeuwes, Naert and Habermann to the Symposium deal with redistributive coalitions and rent-seeking in a more direct manner.

5. John Locke, Two Treatises of Government, II, Chapter 2, paragraph 4. Locke explains what he means by “the bounds of the Law of Nature” in paragraph 6 of the same chapter. His “Law of Nature” is an amalgam of naturalistic and theological ideas. Locke’s naturalism refers to the natural fact of the separateness of persons, all of whom are equally human (“furnished with like Faculties”). The Law of Nature requires men to recognize this fact and to accept its implications: “being all equal and independent, no one ought to harm another in his Life, Health, Liberty, or Possessions,” “[no one may] unless it be to do Justice on an Offender, take away, impair the life, or what tends to the Preservation of the Life, the Liberty, Health, Limb or Goods of another.” His theology supports the other part of the Law of Nature: “[Man] has not Liberty to destroy himself, or much as any Creature in his Possession, but where some nobler use, than its bare Preservation calls for “Every one is bound to preserve himself, and not to quit his Station wilfully; so by the like reason when his own Preservation comes not in competition, ought he, as much as he can, to preserve the rest of Mankind. This part of the Law of Nature refers to God’s proprietary rights as Creator or Maker of the natural world and of every human being in it. Locke recognised that natural law, be it ever so evident in its principles, has to be applied and enforced under conditions where its implications may not be clear. His naturalism led him to leave these problems to the practical social skills of people in finding mutually acceptable solutions; his theology led him to entrust them to a worldly, yet “sacred,” institution: the state. The state should ensure that people continue to serve God, even when they have no direct interest in doing so.

6. The term “liberalism” can be applied to a wide variety of ideas. I shall use it only to refer to what in the Anglo-American literature is usually called “Classical Liberalism.” Some of Locke belongs to that tradition, and, so does some of Hayek. Following Eric Havelock (The Liberal Temper in Greek Politics, London: Jonathan Cape, 1957), Karl Popper (The Open Society and Its Enemies, Part I, London: Routledge & Kegan Paul, many editions), and others, I think (but shall not argue here) that it can be traced back to the Sophists’ naturalistic and historical teachings on human society. I shall use a stricter conception of liberalism than that of most classical liberals to highlight the contrast with the philosophy of statism discussed later on in the text.

7. On the terminological and conceptual issues discussed in this paragraph, see Frank van Dun (1995), “The Lawful and the Legal,” in VI (4) Journal des économistes et des études humaines, pp. 555-579.

8. Examples are societies for the Protection of Animals, for the Advancement of the Arts and Sciences, The Society of Friends, and such like, business corporations (sociétés anonymes), but also nation-states. All of these need a well-specified criterion for distinguishing members from non-members, for the purpose of collecting dues and allocating tasks as well as for the purpose of distributing income within the society.

9. Cf. open society (Popper), great society (Hayek), general society. In Dutch there is a clear distinction between “maatschappij” (company, exclusive society) and “samenleving” (inclusive society). Law, as I use the term, belongs to inclusive society (“samenleving”), which is not a membership organisation; everybody who lives according to law is, by that fact alone, in society. One who does not, is by that fact alone an outlaw. Note that there is no sense in supposing inclusive society to be unlawful; on the other hand, societies-as-companies can be, and often are, unlawful in many respects. In this paper “society” refers to inclusive society unless another sense is specified by an explicit qualification.

10. This concept of natural law belongs to a naturalistic philosophy; it should not be pressed into the service of some grand metaphysical or theological scheme.

11. Because of the diversity of human characters and external conditions, and because life is nothing apart from the experience of living, abstract theorising about the content of “personal morality” is mostly barren. It may be possible to identify some intrinsic goods on the basis of a general consideration of human nature, but any proposition about their relative values or priorities in particular circumstances is extremely speculative.

12. Jeffrey Friedman, “Accounting for Political Preferences,” in Critical Review, volume V, number 3, 327. For a more extensive criticism of Friedman’s argument, see Frank van Dun, “Hayek and Natural Law: The Humean Connection,” in J. Birner & R. van Zijp (eds), Hayek: Coordination and Evolution. His Legacy in Philosophy, Politics, Economics and the History of Ideas. London, Routledge and Keegan Paul, 1994, 269-286.

13. See Frank van Dun (1995), “The Lawful and the Legal,” in VI (4) Journal des économistes et des études humaines, pp. 555-579. “Lex” appears to be originally a military term; it is related to “dilectus,” which refers to the act of calling people to arms or drafting them into an army. Hence the general meaning: general command given by the highest authority. There is no connection with “law” (order).

14. Of course, it may depend on meta-moral reasoning, but the argument was not that liberal neutrality is a myth because it is the conclusion of a particular sort of non-moral argument, namely a meta-moral argument.

15. John Locke, The Second Treatise of Government, Chapter VIII, paragraphs 119 sqq, tried to present this unlikely event as required by the logic of social contracting: “[E]very Man, when he . . . incorporates himself into any Commonwealth, he . . . annexed also, and submits to the Community those Possessions, which he has, or shall acquire, that do not already belong to any other Government” (§ 120). Actually, these paragraphs contain some of Locke’s most absolutistic utterings: “[The obligation to obey the laws of the government] reaches as far as the very being of anyone within the Territories of that Government” (§ 119): “[H]e, that has once . . . given his Consent to be of any Commonweal, is perpetually and indispensably obliged to be and remain unalterably a Subject to it, and can never be again in the liberty of the state of Nature (§120). To appreciate the illiberality of these statements, just substitute “woman” for “man,” “holy matrimony” for “commonwealth,” and “husband” for “government.”

16. Not many people appear to have accepted Robert Nozick’s all too complex and convoluted attempt, in Anarchy, State, and Utopia (1972) to provide what he called an “invisible hand” explanation of the lawful genesis of the state.

17. As it was defended by Robert Filmer in his Patriarcha (1675), the target of Locke’s First Treatise.

18. I take the word “war” in its broad original sense of confusion, disorder (as, in Dutch, ver-war-ring).

19. Or perhaps: her—in Jewish mythology Leviathan was often depicted as a female monster that ruled the seas and that would ultimately defeat Behemoth, the male monster that ruled the land. In the book of Job, where Hobbes probably got the idea of using “Leviathan” as a metaphor for the state, Leviathan is a male creature of which it is said that “When he raiseth up himself, the mighty are afraid . . . He maketh a path to shine after him . . . Upon earth there is not his like, who is made without fear. He beholdeth all high things; he is king over all the children of pride.” (41:25-43) Thus, “Leviathan” stands for all that is awesome, fearless and invincible, like a mythological warrior, or as Hobbes put it, “a mortal god.”

20. Among the “Diseases of a Commonwealth, as are of the greatest, and most present danger,” “the poyson of the seditious doctrine . . . That every private man is Judge of Good and Evil Actions” ranks second, immediately after the king’s want of absolute power. “Another doctrine repugnant to Civil Society, is, that whatsoever a man does against his Conscience is Sinne; and it dependeth on the presumption of making himself judge of Good and Evil.” (Leviathan, Chapter 29).

21. Richard Tuck’s Philosophy and Government (Oxford 1994) extensively discusses the intellectual background of the “revolution” in political thought brought about by Grotius and Hobbes.

22. In an age when Cartesian dualism was an increasingly influential philosophical paradigm, the idea that the “divine” element, the mind or the soul, exists in a realm apart from the lowly body and material nature, the dissociation of action and judgement could easily appear to be uncontroversial.

23. And also, Plato adds, a war of each against himself: people are likely to adopt ever more unhealthy lifestyles.

24. The Nocturnal Council appears in Plato’s last work, The Laws. The Philosopher-King is the linchpin of “the city constructed in speech” in The Republic.

25. This is one of the main dividing lines between marxism and liberalism (or even libertarian socialism: e.g. Franz Oppenheimer’s comments on Marx, in his The State (1975 [1914], p. 12). For natural law liberalism, the basic distinction is between lawful and unlawful action (which corresponds to Oppenheimer’s distinction between economic and political methods of purposive action). Unfortunately, most economists have come to believe that the distinction between lawful and unlawful should be made on “economic” grounds (utility, efficiency). This is most clearly the case with the adherents of the Law and Economics movement and the Property Rights school (see the critique by W. Block, “Ethics, Efficiency, Coasian Property Rights, and Psychic Income: A Reply to Harold Demsetz,” The Review of Austrian of Economics, 1995, VIII, 2, 61-125, and the literature cited therein), but also of mainstream public policy analysts (cf. note 38 below).

26. This vision of Rousseau’s citizen as a model for the New Communist Man concludes part one of Marx’s revealing essay on emancipation, On the Jewish Question (1844).

27. Marx’s extension of citizenship to all social activities set the stage for the totalitarian and utopian project of remaking mankind, of recasting the raw human material in the mould of the New Man. According to the logic of the theory, state and society would then coincide. When everyone has absorbed the requirements of citizenship, there is no or only a marginal need for a coercive institution. Most of the totalitarian projects inspired by Marx have now collapsed under the weight of their own inefficiencies. Other projects have attempted to create a new class of guardians, mainly by appealing to racist and nationalistic sentiments. Most of these too have collapsed or spent themselves in bloody wars. However, we need not go into this aspect of the history of the twentieth century.

28. It is true that Plato, like Rousseau occasionally went into the business of political consulting, but what advice he gave his “clients” is not very clear. We do know, however, that Rousseau, as a political consultant, took care to advise against using Du Contrat Social as a revolutionary’s handbook.

29. Hobbes does not fit this interpretation, but he was more concerned with maintaining an absolutist state than with getting one off the ground.

30. I was somewhat surprised to hear Erik Schokkaert object to my “enumeration of undesirable consequences [of statism]” on the ground that “consequentialism is in direct conflict with [Van Dun’s natural law] position.” However, a “natural law position” does not condemn looking into the consequences of actions, even it will not accept that a particular person’s (or profession’s) valuation of an action’s consequences may be sufficient to permit that action to be executed if it is not to be allowed on account of its unlawful character. Moreover, it should be clear that I am discussing consequences that most of the adherents of statism have themselves claimed to be undesirable, and, in fact, were precisely the symptoms of the disease they thought statism would cure. Besides, I hope it will be granted that it is not improper for me to comment on the undesirability of systems of action and thought that do not take the distinction between the lawful and the unlawful into account. Even more surprising was Schokkaert’s comment that “[Van Dun] never makes explicit in what terms consequences should be evaluated. This gives his description a very moralising tinge.” This is surprising, because I believe that individuals (whether economists or not) “evaluate consequences” in whatever way they deem appropriate. As a philosopher of law, I am not concerned with how people evaluate alternative courses of action, but with what they do [to others] after they have come to a conclusion.

31. As Rousseau wrote in his essay Sur l’economie politique (“On Political Economy”) for the Encyclopedie: “We may say that a government has reached the ultimate stage of corruption when it has no other link to the people than money. But every government always tends to become lax, and that is sufficient proof that no government will subsist unless it continually seeks to increase the revenue.”

32. Top billing goes to the famous Prisoner’s Dilemma that has been studied and discussed ad nauseam by social scientists and psychologists for the past fifty years or so. Few appreciate the irony that the situation that gave the dilemma its name was concocted by a state official to trick two hapless prisoners into an extended stay in jail.

33. In his comments Erik Schokkaert noted that “prisoner’s dilemma-type of argumentations seem to upset Van Dun so much.” He finds this surprising, “since recent developments in the theory of repeated games show that in many cases the cooperative solution can be reached without outside intervention, and I would suppose Van Dun would be quite happy with that conclusion.” However, PD-type of argumentations as such do not upset me at all; what does upset me is the clear bias (in the economic literature, especially textbooks) in presenting them almost exclusively as analyses of “market failures” and grounds for “government intervention.” As for the theory of repeated games—Schokkaert presumably refers to the work of Anatol Rapopport, Michael Taylor, Robert Axelrod, and others, I am happy with cooperative outcomes where lawful activities are concerned. But I must confess that I find no reason to rejoice in the prospect of a cooperative outcome when the repeated game is, say, between rival gangs attempting to control a city—even if the outcome, is ex post facto called “the city government.”

34. Professor Schokkaert’s views on the welfare state are somewhat perplexing: on the one hand, “[it] has to be reformed quite urgently; . . . [it] is too redistributive, and therefore has lost the support of large groups; . . . many [of its] regulations, are unnecessary and dismantling them would lead to a far better society”; on the other hand, “I do like very much the basic inspiration behind it.” Unfortunately, he does not tell us what that basic inspiration is. However, he does tell us, that “theory (and empirical reality) show us that private insurance is impossible or will be extremely incomplete for risks related to unemployment and to health,” because the textbook conditions for private insurance—independent risks, approximate information symmetry, and control of moral hazard—are not satisfied. “Introducing a collective insurance system is then Pareto-improving.” Really? Always? Any collective insurance system? How do we know this is a fact of “empirical reality,” given that such a system is likely to crowd out, even suppress, any private alternative with which it might be compared? Is it superior to private charity? Is it superior to a world with low or no taxes that depress economic activity, a world without banking laws and monetary institutions that induce inflation and boom and bust cycles? Is not moral hazard much more of a problem with “collective” insurance than with private insurance? How about the moral hazards affecting the managers of the system-playing politics with social security, et cetera? And what about information asymmetry in “collective” insurance systems, which (as theory and empirical reality show) tend to be captured by well-organised, well-informed groups, and to end up in such desperate financial straits that politically imposed “adverse selection” in some guise or other soon becomes an enlightened policy option?

35. At present many statist intellectuals prefer to locate their imaginary Olympus in the palaces of international and supranational organisations rather than in the centres of the somewhat worn-out nation states. They are still looking out for a relatively inaccessible sphere where the guardians can rule serenely without being reminded at all times where their power comes from and on what conditions they can keep it.

36. Professor Schokkaert: “I do not know any economist who could [identify with the statist position as it is described by Van Dun]. I think that what he describes is a straw man that can easily be defeated afterwards.” But this remark misses the point. Yes, statism is a straw man, in the sense that few people (other than the statist philosophers who, as philosophers, are willing to follow the argument wherever it may lead) accept all of its implications in toto; nevertheless statism continues to supply arguments that can be used in an ad hoc fashion, either to defend particular state actions and policies, or to ridicule pleas to strengthen the institutions of law and justice. Amazingly, Schokkaert then goes on to demonstrate this very point. Repeatedly he stresses that “the answer [to the question of the desirability of state intervention] depends on a careful analysis of the consequences of state intervention in specific circumstances and for specific cases.” I shall not comment on the claim of economists to be able to “analyse consequences” of an as yet unperformed act of state intervention in “specific circumstances and for specific cases” (which are uncertain, because they are by no means guaranteed to remain stable in the [near or not so near] future, or to resemble past cases in all the relevant respects)—Schokkaert appears to agree that the empirical (necessarily historical) data are hardly ever “conclusive.” Rather more pertinent is the fact that, unless we have a Platonic Economist-King, the economists can only submit their speculative “answers” concerning the desirability of state intervention in specific circumstances and for specific cases to the rulers. But the question as it exists in the mind of a ruler is probably not: “Is intervention in this case better [in some unspecifiable “scientific” way] than non-intervention?” The question is likely to be: “Is it in my interest to intervene here and now in this way rather that that, or is it in my interest not to intervene right now?” or “Which ‘analysis of the consequences’ should I buy?” Even more to the point Schokkaert seems to suppose, that the decision, whether to intervene or not, should depend only on his “careful analyses”—but does this not mean, that in principle the state should be able to intervene whenever, wherever and howsoever its [economists] wisdom suggests? Is this not full-fledged statism as defined in this paper?

37. It might be objected that at a deeper level the state is neutral. The argument might be that the state can be captured by any private interest or combination of private interests—that it is not inherently biased with respect to any private morality. This argument implies that the state is merely a form of action and does not specify any particular end or value. In its popular form the argument is that state power can be used for good as well as bad purposes. Nevertheless, the argument fails, because, whether its purpose is “good” or “bad,” state action still embodies the particular judgement that the end justifies the means, i.e., the judgement that law should not hinder the powerful from reaching their ends, if necessary by coercive means.

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Posted November 8, 2007

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