Friday, January 25, 2013

How Free-Market Thought Succeeded By Getting More Radical

by Brian Doherty


January 26, 2013

Angus Burgin, an historian at Johns Hopkins University, has produced a well-researched, well-written, and largely well-thought-out study. The Great Persuasion chronicles the intellectual adventures of F.A. Hayek, Milton Friedman, and the other market-supporting academics, think tankers, and businessmen who comprised the Mont Pelerin Society, founded in 1947. It also offers Burgin’s accounts of who he thinks were Pelerin's most important intellectual predecessors. The book’s only overarching flaw is that Burgin at times seems confused about what ideology his book is a history of, conflating conservatism with libertarianism. It’s a mistake I strove to correct with my 2007 book Radicals for Capitalism: A Freewheeling History of the Modern American Libertarian Movement, which reports on many of the same characters and stories as Burgin.

Burgin knows there is a distinction between the two ideologies—he mentions libertarianism a few times—but he misses the importance of the distinction in ways that complicate his efforts to link post-Pelerin developments to pre-Pelerin forebears. In many respects Hayek and especially Friedman represented something new, or at least long missing in action, under the intellectual sun. So Burgin talks about evolutions in a body of thought that are more fruitfully explained by imagining a new species inhabiting fresh ideological space. When Burgin writes of a “they”—the free-market advocates he traces from the ‘30s to now—who saw “their assumptions and arguments discreetly but decisively transformed” in the direction of greater acceptance of untramelled free markets, I’d argue that there is no “they” there; that Burgin is really telling the story of the rise of libertarianism from its ur-roots, without crediting it as such or widening out its story from Hayek and Friedman.

Burgin starts with the king of 20th century interventionist economists, John Maynard Keynes, lamenting in 1924 that the popular mind had embraced a vulgar simplification of economists’ thinking and thus believed in unrestricted free markets. (Those were the days: laissez-faire, allegedly the unconsidered prejudice of the masses.) Keynes declared laissez-faire intellectually dead among the more educated class and the economics profession, and by the end of World War II that death sentence seemed so obviously true that an international group of economists, philosophers, and businessmen who still believed in the competitive market (though even they tended to reject pure 19th-century laissez-faire) felt so embattled and lonely they create a brotherhood, the Mont Pelerin Society, to keep the flame of those ideas guttering in their professions and countries. While in and of itself the group, which met regularly to discuss and hash out ideas related to markets and liberty, did no persuading and produced no branded work, its members—especially Friedman—often identified the sense of fellowship, intellectual exchange, and connections it provided with helping cement their ideas and strengthen their intellectual work.