The report of this little exchange between Beveridge and Hayek is still relevant. This is all the more the case to me when I consider how the thinking of Hayek, von Mises, Rand, and other godless economists of the Austrian economic and Libertarian school continue to capture the hearts of many Evangelicals.
I will grant von Mises one point - it was perhaps the truest and most astute statement he ever made:
“A living Christianity,” said Mises, “cannot exist side by side with, and within, Capitalism”
As John Medaille reports:
'Later in his career, Mises would allow that Christianity could exist within capitalism, but only if the Christians kept their opinions to themselves, only if they were marginalized and kept apart from the political and economic orders.'
And,
Mises considered himself a “man of 1789, an heir of the Enlightenment,” that is, a man of the French Revolution. And the great advantage of the French Revolution, from the standpoint of liberalism, was that it destroyed the older social order in general and the social authority of the Church in particular. As Mises himself put it, “for us and for humanity there is only one salvation: return to the rationalistic liberalism of the ideas of 1789” (Mises, Nation, State and Economy, p. 239.)
Continuing with von Mises, these quotes are noteworthy:
[Jesus] rejects everything that exists without offering anything to replace it. He arrives at dissolving all existing social ties…. The motive force behind the purity and power of this complete negation is ecstatic inspiration and enthusiastic hope of a new world. Hence his passionate attack upon everything that exists. Everything may be destroyed because God in His omnipotence will rebuild the future order…. The clearest modern parallel to the attitude of complete negation of primitive Christianity is Bolshevism. (Socialism, p. 413)
Jesus’s words are full of resentment against the rich, and the Apostles are no meeker in this respect. The Rich Man is condemned because he is rich, the Beggar praised because he is poor…. In God’s Kingdom the poor shall be rich, but the rich shall be made to suffer. Later revisers have tried to soften the words of Christ against the rich … but there is quite enough left to support those who incite the world to hatred of the rich, revenge, murder and arson…. This is a case in which the Redeemer’s words bore evil seed. More harm has been done, and more blood shed, on account of them than by the persecution of heretics and the burning of witches. They have always rendered the Church defenceless against all movements which aim at destroying human society. The church as an organization has certainly always stood on the side of those who tried to ward off communistic attack. But it … was continually disarmed by the words: “Blessed be ye poor; for yours is the Kingdom of God.” (Socialism, p. 420)
Von Mises in many ways represents the school and yet Hayek is no less a ranking figure and his views are remarkably similar. It continues to amaze me that this economic school has been widely embraced by professed Christians. The Catholic author in the link marvels over this as well - as the same phenomenon has taken place in conservative Roman circles. In both cases, American economic ideology (in reality a religion in itself) is masquerading as Christianity. I think the proponents of this are not just wrong on economics, they need to be called out as false teachers and heretics. Their problems are at core spiritual and ethical - they reject New Testament teachings and substitute them with the ethics and ideals of what must be called another religion.
The Beveridge-Hayek debate remains relevant for many reasons, not the least of which is with regard to fascism. Is it the scion of capitalism or socialism? Or perhaps neither - there is after all that possibility as well.
Stiglitz argues that Hayek was completely wrong, effectively positing that capitalism produces instability and generates resentment and confusion - that is then channeled into conduits of anger.
I recalled in Deutscher's 'The Prophet Outcast' that Trotsky warned of this in the 1930's while in exile. The unrestrained capitalism of the 1920's had blown up and the workers could be swept up into socialist and revolutionary movements or could just as easily fall prey to an angry demagogic nationalism that blamed 'others' for all their ills. We know what happened - especially in Germany.
In fact I think about it all the time and had been thinking about the fact that Trump is so popular in a place like Butler, Pennsylvania - a place I know reasonably well. On the day of his shooting I was at a family gathering less than an hour away.
While the US is not in a Great Depression, the same forces are at work. The Rust Belt is not the result of Socialism but hyper-Capitalism and yet most of the people that live in this region do not understand what has happened. They blame 'Chinese' and 'Mexicans' and the wars in the Middle East (which they also do not understand) have frustrated them and given them someone else to blame and hate.
And yet I can personally testify that while visiting churches in the Rust Belt - not a few elders and others will invoke the likes of Hayek, Friedman, Sowell, and others of that ilk in attempting to explain the region's economic woes.
The article rightly raises the question of the nature of freedom, something Europeans tend to understand with a greater degree of clarity. That may sound strange to American ears as Europe is associated with high taxes and regulation and this is not to deny there are dynamics in play when it comes to this debate. But essentially the argument is this - if you don't have real choices available to you, you're not free at all. There is no freedom in poverty. You are degraded, demoralized, and simply try to survive. The fact that you might have freedom of speech, the right to vote, or a lack of regulation are meaningless to someone who is destitute. They are only free to say 'Yes, boss' to their employer as they live paycheck to paycheck. Without access to the full spectrum of social life, they live in society but as if in a cage.
Libertarians attack zero-sum arguments, insisting on the endless possibilities of wealth generation and yet they ignore the limitations of resources and credit and as such, Stiglitz is right to argue that more freedoms for some will in fact lead to less freedoms for others. While this sounds terribly socialist to some ears, it is not in fact a call for redistribution and forced equity. Stiglitz is not a socialist or Marxist but believes that gross inequality is destabilizing. Capitalism is one thing on paper - but it must function within the matrix of a society. If the matrix itself is destroyed, what then?
The idea of giving a little more to the people at the bottom is often decried as 'Bread and Circuses' and there are cases where this is probably the case. And yet, some of the people at the bottom - if they only had a little more, would be content. In fact, the New Deal and Great Society programmes of the 20th century have achieved this end and have kept the peace despite the extreme inequalities in American society. And yet, the Right assiduously and diligently labours to dismantle and undermine these programmes which are not 'bread' but more a case of bread crumbs. As I have often argued, if they would visit some countries in the Developing World they would understand that without these programmes you end up with shanty towns and favelas and the rich (while they may not pay taxes) will spend a fortune on security as the destitute have little to lose.
And they would also do well to understand that people who have tasted the sweet meats of middle class life are all the more bitter when they lose it. And I don't doubt a great deal of the depression, drug use, and suicide among working class whites is due to this fact. They feel like losers and are defeated. Their lives (historically) are not too bad and yet they are so degraded they are driven to despair. As someone who grew up relatively wealthy and am now solidly in the lower/working class I can testify to wrestling with this. If I were not a Christian it would really upset me but of course if I were not a Christian I would not have the morals and conscience that I do and I would have ordered my life very differently and like Scarlet O'Hara I would be sure that I would never suffer again - no matter what I had to do or whom I had to hurt in the process.
Neoliberalism arose out of the malaise of 1960's and 1970's economics. US dominance was challenged by rising economic powers such as Europe and Japan. The old economic liberalism was viewed as dead in light of industrialisation and the world wars. Neoliberalism represented a kind of 'fundamentalist' response, an attempt to repristinate the old capitalism of Adam Smith and yet at the same time was something a bit different, more a permutation than a true purist restoration.
Some have benefitted tremendously from this and have grown very wealthy. And yet they have built their wealth on the suffering and even the corpses of those at the bottom. It's an old story in new packaging.
The narrative concerning Stiglitz's tenure in the Clinton administration, the question of financial de-regulation and the 2008 meltdown is interesting. One also thinks of the Reagan-era crash of 1987. In both cases a great depression was knocking at the door but (as flawed and corrupt as it all is) the tools used by the state were able to stave off the worst potentialities.
This also touches on the question of Clinton (and Blairite) economic policies and their attempts at triangulation. Far from being socialists, they were in fact capitalists that successfully moved both the Democratic and Labour parties to the Right. Far from being a socialist, someone like Bernie Sanders is really just an old Democrat of the FDR stripe and figures like Pelosi, Biden, and even Keir Starmer are (economically speaking) more on par with someone like Richard Nixon. In terms of fiscal policy they barely qualify as Centrist let alone Left wing.
The article is both fair and right to mention South American economies that have experimented with such 'left-wing' economic policies and it has led to disaster and now a reaction. The story is of course a little more complicated that what the NPR article allows for but the point is still taken.
With regard to Hayek's serfdom road - many are already thralls to the corporations and increasingly find themselves subjected to a kind of state-corporate hybrid envisioned in dystopian novels.
Though the article did not really elaborate the idealism behind the shifts in the GOP, it's right to mention that thinking is shifting and economic nationalism is coming into play - something wholeheartedly rejected by the von Mises/libertarian/Austrian school. And yet it is very much in keeping with the rise of fascism.
The response of Stiglitz to these trends merely underlines the fact that he is no socialist at all. He doesn't criticize Hawley or Rubio by arguing for nationalisation but instead would like to see competition - but regulated. That's managed capitalism.
As a Christian, I am on the one hand not terribly interested in any of these ideas. I believe there are no solutions as this world is fallen. None of these systems work because man is inherently corrupt and evil and will manipulate the system - whatever its ideals or parameters. Also, the world is broken and the dynamics are so complicated that all of these systems which might look good on paper (also relying on a clean slate) begin to quickly break down in real-world scenarios and interplay.
Additionally, the system is rigged with inflation built in. Your money depreciates as it sits in the bank and so all but the mad (or principled) will invest their money in the markets - stock, bond, commodity, or otherwise. It's the only way to beat inflation and in the American system, finance capital (as opposed to industry) is king. This is a point sometimes raised by Libertarians and as such they attack fiat currency and argue for a return to the gold standard.
But the gold standard is antiquated and ill-equipped for the high volume credit dependency of an industrial and now techno-industrial globalist economy with currency exchanges and the like. The gold standard also leads to corrective cycles of deflation which is devastating for finance capital and other sectors. It's completely understandable that this system was dispensed with. Additionally it allows outlets like the Federal Reserve to manipulate interest rates and liquidity - tools to stave off economic shocks and spirals that lead to economic depression.
Again, the system is rigged. I expect that to be the case. The answer isn't to invest and try to beat the market - building your fortune on usury, manipulation, and the exploitation of others. Neither is the answer to 'reform' the system by returning to outdated forms that only worked when the country was much smaller and more agrarian. No, the answer is to follow Christ's teachings and lay up your treasures in heaven. Don't allow your faith to be choked by the deceitfulness of riches. In the end, it's Caesar's coin after all. Dominionists reject this teaching because everything has to be part of the Kingdom and sanctified as such. That's not what Christ or the apostles taught. We use Caesar's coin as something that isn't ours and isn't holy. It's functional but we should always remain detached. This is hardly a ticket to middle class life but as I have long argued the bourgeois values of security and respectability are incompatible with the Christian calling and New Testament values. The Magisterial Reformation has often been associated with the Middle Class - to its shame.
The medieval protesters understood these principles as did many in the Early Church - especially before Constantine. This is why poverty was extolled and emphasized and why they so vigorously protested the wealth, corruption and simony that characterized the Church - a situation we also have today, albeit it in different forms.
Since I have no wealth, am not invested in this society, am not prepared to call on the state to defend my wealth, or kill for it - I have no stake in the debate. I would like to be left alone to pursue my Kingdom calling. Rather than fight the machine, I'm more inclined to simply pivot away and keep simplifying and streamlining my life and work. I'm not interested in complications and entanglements. These projects might be more lucrative but they are a source of grief. I crave simplicity. I don't want to bring my work home with me - so to speak, though invariably I do.
The Holy Writings reveal that I cannot serve God and Mammon and I'm not interested in trying to push that envelope or see how far I can get to the edge without crossing the line. It's simply not my focus or interest. I believe our society is wicked and thus it follows that the wicked will flourish in it. It's not that complicated.
But of course it is because we all have to wrestle with the dynamics and where to draw lines. I think that has to be done on an individual level. I know quite a few people who deliberately and even zealously avoid these topics as they don't want to think about it or be forced to examine their lives and choices.
So why interact with this NPR piece and the Austrian School?
Because when I go to church I consistently encounter people who drink from these polluted wells and through their influence doors are opened to outside influence - and the money of Wall Street and other powerful corporations. Their commitments (which are other than Christian) are baptized and have found their way into Sunday School curricula, pulpits, podcasts, and other venues. As such, we must respond to this. I don't have to agree with Beveridge or a contemporary like Stiglitz. He's as lost as they are but his critiques are useful and devastating and these people need to be answered. I'm referring of course to the people in the Church. As far as the Babylon that is America, there's no reforming that Beast. These sinful ideals are at the very core of its identity and like these economic paradigms are wont to do - it's also self-destructing. There's no stopping it. It may recover (as did Rome and other empires) but only for a season and from each crisis it emerges as something new. Eventually the changes accumulate. Whether the forms merely change and the substance is the same or the forms remain and the substance has changed is open for debate. What is America? What has it always been? What is its essence? I know how Christians would answer and as such I too must wrestle with such futile questions. I would argue the essence of America is something quite different from what they think and were they to see it in its raw and naked form they would recoil in horror. But like it or not that ugliness is coming to the fore. So far, they're embracing it. We'll see how far that goes.
See also:
https://www.frontporchrepublic.com/2009/10/the-one-salvation-of-ludwig-von-mises/