Reconciling Rawls and Hayek?

• Author: Chartier, Gary
• Position: John Rawls and Friedrich Hayek - Critical essay

John Tomasi's thoughtful and provocative book Free Market Fairness (Princeton, N.J.: Princeton University Press, 2012) offers, in effect, a Rawlsian justification for Hayekian classical liberalism. It seeks to show both that there is good reason to take seriously the concern for the worst-off built into Rawlsian "high liberalism" (1) and, at the same time, that a classical-liberal political order of a certain sort can satisfy the concerns underlying the Rawlsian project. The book has already been the subject of considerable scrutiny and the topic of multiple conversations (its first printing sold out within a month), and it seems likely to play a significant role in shaping current discussions of the nature and future of the liberal tradition. It deserves careful attention.

I

John Rawls famously supposes that we should regard as just the set of social institutions that would be endorsed by people deliberating in "the original position," behind a "veil of ignorance'--unaware not only of their own social positions, but also of all sorts of other information, including their own conceptions of the good life. Such people, Rawls supposes, would settle on basic principles, including respect for certain basic liberties and a requirement--the "difference principle"--that inequalities in material goods be permissible only to the extent that they tended to benefit the least well-off socioeconomic class, the working poor.

For Rawls, the basic liberties enjoy "lexical priority": they cannot be infringed in the interests of material well-being (though Rawls sometimes seems to have doubts about this stipulation). These liberties do not include protections for rights to own productive property and engage in market exchange. And although the difference principle is said to be intended as a constraint on the "basic structure" of rights, institutions, and so forth rather than as a guide for individual policy choices, Rawls seems at points to see it as licensing substantial, ongoing interference with the distribution of wealth that results from voluntary transactions.

Tomasi seeks to show that the essential shape of Rawls's theoretical approach to establishing the content of justice can be maintained even as it is modified to render it much more market-friendly. Rights to use and exchange productive property can, he maintains, be justifiably incorporated into the list of lexically prior basic liberties because of their importance in enabling people to engage in economic production, a crucial aspect of individual self-authorship. And knowledge of sociology and economics can help to shape the application of the difference principle in such a way that redistributive activity by the state is minimized, precisely on the basis that a genuinely free market benefits the working poor more than any realistically conceivable alternative. Tomasi labels his preferred approach "market democracy." He suggests that in its willingness to treat concern with the least well-off as crucial to the justification of political institutions, this approach is, perhaps surprisingly, at one with that of a diverse array of classical liberal and libertarian thinkers, including Herbert Spencer, whom he rightly notes should not be dismissed as a Social Darwinist or misanthrope.

Tomasi emphasizes that a variety of "high-liberal" positions can be transformed along market-democratic lines. He focuses specifically on Rawls's own theoretical approach, however, because of its influence and the extent to which it has been developed and refined and because he finds it personally appealing. He recognizes that market democracy, like Rawls's own preferred social democratic interpretations of his position, "liberal democratic socialism" and "property-owning democracy," can be worked out in multiple ways. Tomasi looks specifically at two: "democratic limited government" and "democratic laissez-faire," with the latter most closely approaching the ultraminimal night-watchman state. (2) Each proves to be as defensible, Tomasi argues, as liberal democratic socialism and property-owning democracy: each can reasonably be endorsed by deliberators in the original position, given general sociological knowledge and other available data. But market democracy is finally to be preferred to Rawlsian social democracy because it is more inspiring, offering a more appealing conception of cooperative human life and personal self-development.

II

There is a lot to like about Free Market Fairness, especially Tomasi's regard for the economically vulnerable, his desire to build bridges and move past stale debates, and his sympathetic and careful readings of multiple political theorists. (Consider his provocative development of the idea that as long as justice is understood as concerned with constitutional design rather than with piecemeal tinkering with individual transactions, F. A. Hayek can be understood as defending a conception of social justice because of his concern with the impact of property rules and related legal standards on the economically vulnerable.) And Tomasi's project qualifies as an impressive tour de force: after all, Rawls's project is characteristically understood as grounding and as intended to ground a kind of social democratic political order that features extensive and persistent statc intervention into the economy. To show that it might plausibly be thought compatible with a quite different sort of politics is a distinct achievement. Tomasi's book should help to awaken both Rawlsians and Hayekians from their dogmatic slumbers.

At the same time, there is, of course, room for disagreement. For example, it is difficult to see quite why Tomasi continues to insist that education should be a state-secured function (he prefers funding by vouchers or tax credits to state delivery). He notes that a perfectly good Hayekian argument can be made for the view that the market ought to be used to discover what works well in education (though he reminds us that Hayek himself favored state funding of education). Even if one favors the state's existence and operation, and even if one thinks the state should be involved in meeting the challenge of poverty and economic vulnerability and insecurity, it would seem more efficient and less market distorting for the state to mount a basic income scheme that ensures that people have the resources to purchase the educational services they want than for it to fund education directly or to channel resources to schools through vouchers or tax credits. Direct or indirect state funding tends to ensure that the amount of money spent on the education sector will be fixed (which encourages inefficiency and prevents market dynamics from reducing costs); it enmeshes the state in the control of educational content and delivery mechanisms; and it prevents people from exploring all of the educational options they might pursue, with the effect both that their choices are unnecessarily limited and that nonstandard options, such as the Khan Academy, do not receive the attention they deserve and lack the opportunity to out compete traditional alternatives. (The same sorts of point obviously might be made with regard to state involvemcnt in the provision of health-care services.)

Self-authorship replaces self-ownership in Tomasi's view, but he never clearly explains, at least...