Abstract
The attraction of the Austrian school's liberalism lies in its seemingly clear-cut guidelines in deciding what the limits of government activities should be – namely, to provide security and peace, and to uphold the laws, especially property laws, all in order to ensure the unhampered functioning of the market system. In this paper, I argue that the Austrian brand of liberalism as represented by Ludwig von Mises (LvM) and Friedrich August von Hayek (FAvH) is as much concerned with checking and curtailing government activities as it is with regulating the human mind. Deregulation of the market and regulation of the mind go hand in hand with the instrumental expansion of market competition resulting in a specific mode of production and way of thinking. From an ethical point of view, the supreme role of market competition has to be called into question as it not only narrows the choices of feasible ways of life, especially to those not endowed with capital, but also conditions the way we think (mind control). To highlight this critique of the Austrian brand of liberalism I compare it to the perfectionism of the classic liberal thinker Wilhelm von Humboldt (WvH), whose liberalism is wrongly believed to be in accordance with LvM and FAvH's liberalism. WvH avoided formulating a liberal vision of a polity without a rich perfectionist conception of human nature. This conception provides the normative backdrop of his entire political thinking. Without WvH's finespun understanding of human nature and care for self-realization the reign of competitive markets transforms liberalism into an alienating force regulating the human mind in accordance with consumerism and, as WvH would say, turning man into a machine.
Highlights
Reaching far back before liberalism’s advent as a coherent and influential political philosophy, Plato’s Politeia discussed the role the state should play in forming people’s lives
This is usually seen as a deregulation strategy on the part of market liberalism, one that secures the private sphere against the state, balances private and state power and, in the process, secures democracy [16]
Private property creates a sphere of freedom, where the autonomy of the individual is safeguarded against the state. This autonomy means that man’s freedom is framed within the market system where competition is the rule of the game: “The freedom of man under capitalism is an effect of competition” [44]
Summary
Reaching far back before liberalism’s advent as a coherent and influential political philosophy, Plato’s Politeia discussed the role the state should play in forming people’s lives. The pure market mechanism can only serve as a machine for generating material wealth and innovation if it ranks supreme and is not meddled with by democratic interventionist endeavours that aim to impress ideas (of social justice) external to the market onto its results, which, in turn, skew market signals that are crucial for production planning This is usually seen as a deregulation strategy on the part of market liberalism, one that secures the private sphere against the state (each to his own), balances private and state power and, in the process, secures democracy [16]. In this essay I contend that WvH’s idea of “Bildung” (here translated as “self-realization”) is not compatible with the radical conception of competitive market systems (“catallactic competition” [19]) as propagated by LvM and FAvH [20]
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