The Big Myth: Fictions of Free Market Fundamentalism

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Cover of The Big Myth: How American Business Taught us to Loathe Government and Love the Free Market by Naomi Oreskes and Erik M. Conway

According to the American Economic Association:

Economics can be defined in a few different ways. It’s the study of scarcity, the study of how people use resources and respond to incentives, or the study of decision-making. It often involves topics like wealth and finance, but it’s not all about money. Economics is a broad discipline that helps us understand historical trends, interpret today’s headlines, and make predictions about the coming years.

If that’s how professional economists define their field, a question should arise in your mind: what does economics have to do with human freedom? To understand human freedom, other fields of study seem to be more relevant: philosophy, sociology, political science, or even history. In their new book, Naomi Oreskes and Erik M. Conway, The Big Myth: How American Business Taught Us to Loathe Government and Love the Free Market (read an excerpt here), tell us why Americans tend to think that “freedom” is best addressed by economics. As the title indicates, it is the result of over a century of mythmaking funded by businesses, corporations, and very, very wealthy people. It is the Big Myth.*

The book is a critique of the extensive public relations campaign that “market fundamentalists” have been conducting in the United States for over a century. Oreskes and Conway have nothing against markets and give credit to them where credit is due. The difference between them and the “market fundamentalists” they critique is that:

Contemporary conservatives, libertarians, and market fundamentalists are not really defending capitalism, even if they think they are. They are defending a certain idea of capitalism, a vision of growth and innovation by unfettered markets where government just gets out of the way. (p. 13)

The idea of the perfect, unfettered market, however, existed, “precisely never. There has never been a time in human history when markets met these conditions, and there is no reason to think that such conditions could ever exist” (p. 418). Nonetheless, the utopian vision of a “free market” has been invoked time and time again against any kind of governmental oversight or regulation of businesses.

Market fundamentalists can only advocate for unfettered markets by ignoring the role government has always played in capitalism. For example, free market fundamentalists make much of what they call the “Great Enrichment:” the great growth in wealth beginning in the 19th century. I’ve pointed out in this space before how slavery, not libertarian “freedom” was responsible for a great deal of that wealth (see here and here). Oreskes and Conway point out that much of the geographic expansion that fed the “Great Enrichment” came from the displacement of American Indians (pp. 172-85, 226). The idea that European settlers could simply take the land of indigenous Americans comes from John Locke’s idea of “property rights” and has been endorsed recently by conservative pundit, Jonah Goldberg. No market fundamentalist idea is every truly dead.

Oreskes and Conway also document the rise of industrial technology, the “American System of Manufactures” which allowed interchangeable parts in machinery through the development of machine tools. This technological revolution allowed for the mass production of goods on a scale never before possible. The revolution in industry resulted from the federal government’s investment in the problem: “It took nearly fifty years–what would have been an inconceivable period of research and development for a private corporation in the nineteenth century (or today for that matter)–but once it was achieved, it revolutionized manufacturing” (p. 124). When confronted with well-documented histories of governmental involvement with the creation of wealth and advancing capitalism, market fundamentalists like Milton Friedman, just ignore it, or worse, lie about it (p. 275). The market fundamentalists create a fictional past to suit their ideological predispositions and, more importantly, the ideological demands of those paying them.

Details on page two.

*Full disclosure: Erik Conway and I are graduates from the same PhD program and had the same advisor. He’s a friend. Oreskes and Conway flattered me with a brief mention in the acknowledgments for a tiny bit of help finding some hard-to-locate publications. I have admired and taught their previous book, Merchants of Doubt: How a Handful of Scientists Obscured the Truth on Issues from Tobacco Smoke to Global Warming as well as the related documentary. Additionally, I have used Oreskes’s book, Why Trust Science? as a text in my “Science and Public Policy” class since its release a few years ago.

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Hayek Versus Hayek

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It turns out I have more thoughts on Andrew Koppelman’s new book, Burning Down the House. In my previous post, I dealt with Hayek and racism. Here I focus on Koppeman’s claim that a sharp distinction can be drawn between the crude and radical libertarianism of Murray Rothbard and the sophisticated and moderate libertarian libertarianism of F.A. Hayek. It was Rothbard’s fanatical opposition to any version of the welfare state or regulatory control of businesses that libertarians are embracing today, Koppelman claims. By abandoning such absolutist claims and embracing Hayekian balanced approach to governance, libertarianism can be a useful guide for our future. Koppelman is correct that a clear distinction can be drawn between Rothbard and Hayek but errs in thinking Hayekian thought is not responsible for the libertarian embrace of current policies that Koppelman deplores. I show that Koppelman misunderstands the argumentative strategies employed by today’s libertarians to oppose reasonable regulations on business and the expansion of the welfare state. These strategies are better described as Hayek’s than Rothbard’s. Also, I show that Koppelman’s main intellectual opponent is Hayek himself, who consistently opposed policies that Koppelman claims Hayek’s logic should endorse.

To begin, I will explore Hayek’s argumentative strategy for evaluating a given governmental action.

Frontpiece of Cato's Letters, Vol. 1
The Cato Institute, named after Cato’s Letters was founded by Rothbard and Koch in 1977

For Hayek, Koppelman argues, state action could be justified through cost/benefit analysis: does the proposed action’s benefits outweigh the cost? If so, the action is justified, if not the action is not justified. But that description, which reduces Hayek to the kind of everyday cost/benefit analysis that every policymaker presumably employs in some form and misses what makes a particular calculation “Hayekian.”

What makes a cost-benefit analysis Hayekian is that Hayek demanded that state intervention in the economy shouldered very strong probative obligations “Hayek’s view did not entail minimum government. It rather imposed strict conditions on intervention in the economy” p. 15). For Hayek, the market enjoyed a strong presumption of efficiency and, in order to justify State action, the government should shoulder a quite heavy burden of proof to show that the benefits of taking action outweigh the costs imposed. The state may act in “market failure can be shown.” (p. 177). Koppelman argues that Hayek, read properly, allowed for reasonable regulation of economic activity in order to protect the public good and a welfare state provided those measures met very stringent evidentiary requirements showing them to provide net benefits to society. For Hayek, that could include things like a guaranteed minimum income to provide for basic human needs. These reasonable measures are viewed as anti-libertarian by today’s libertarian right, who are committed to Rothbard’s dogmatic views of private property which forbids such measures. For Rothbardian thinkers, taxation is always theft, state action is always coercive, and the market will always provide for human needs better than the government–views Hayek rejected according to Koppelman. Koppelman concludes, “Hayek’s reasoning thus yields a moderate, pro-capitalism, pro-free trade philosophy that embraces the modern regulatory and welfare state so long as it does its job properly’ (p. 71).

Well, now. Before we all go jumping into bed together, let’s ask ourselves a basic question: do Hayek’s views provide the guidance necessary to actually govern in the way that Koppelman claims it did in the past and should in the future? If the question of state action turns on how much evidence is required to overcome the presumption the market enjoys, for Hayekians, that means the evidence needs to be very good and there needs to be a lot of it. But who makes the determination that the evidence is sufficient? How is the evidence gathered and weighted? What counts as a “cost” or a “benefit?” Those are the kind of questions that need answers before a political theory can guide policy.

More importantly, since there is a strong presumption against state action in Hayek’s formulation, those opposing regulations or a welfare state do not need to “win” any particular argument about such actions. They merely need to set the burden of proof high enough such that it is difficult, or perhaps impossible to meet, as Richard Gaskins has shown. Schematically, the argument looks like this:

  • Make the opposing advocate shoulder the burden of proof.
  • Set the standards for meeting the burden of proof very high.
  • Claim that the opposing advocate has not met the burden of proof either by claiming the available evidence does not meet the burden of proof OR that the available evidence does shows the costs outweigh the benefits.

In fact, this is precisely the strategy employed by the“neo-Hayekians” who are homed at “intellectually serious policy-wonk institutions such as George Mason University and the Cato Institute” (p. 110) to forestall the kind of “modern regulatory and welfare state” Koppelman claims they should be embracing.

Go on to Page Two

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F.A. Hayek and the False Promise of a Racially Just Libertarianism

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The cover of Andrew Koppelman's book, Burning Down the House: How Libertarian Philosophy was Corrupted by Delusion and Greed

In his new book, Burning Down the House: How Libertarian Philosophy was Corrupted by Delusion and Greed, Andrew Koppelman, the John Paul Stevens Professor of Law at Northwestern University attempts to rescue libertarianism from itself by centering the work of Freidrich A. Hayek, one of the most distinguished economists of the twentieth century. Toward the end of the book, Koppelman discusses Barry Goldwater “who admired and sometimes quoted Hayek…After he had the [1964 Republican] nomination [for the Presidency], Goldwater (himself no racist) voted against the Civil Rights Act on libertarian grounds: ‘the freedom to associate means the same thing as the freedom not to associate.'” (p. 188). On the following page, he writes, “Reagan succeeded in shifting American politics–and American understandings of liberty, in Hayekian direction. He used the word freedom in his speeches more than any president before or since” (p, 189). Nestled between those two sentences is this one: “Libertarianism in all the forms we have examined is firmly opposed to racism. We have seen no trace of it in any of the arguments we have surveyed” (p. 189). That Koppelman cannot see any “trace of racism” in Goldwater parroting standard segregationist lines to oppose the Civil Rights Act or in Reagan’s “War on Drugs,” environmental racism, and generally throttling any antiracism in the Republican party underscores the flaws of his analysis of the history of libertarian ideology and racism.

In some respects Koppelman tells a story that parallels Matt Zwolinksi & John Tomasi’s The Individualists. Both books tell a story of libertarian ideas that, somehow, lost their way. What was once a philosophy that championed freedom for all became, or is in danger of becoming, a philosophy of reaction and repression. For Zwolinski & Tomasi it was a reactionary turn the movement took in the second half of the twentieth century. For Koppelman, the problem is similar: it is that libertarianism has misunderstood its own founding ideas; for him, libertarians are too entranced by the views of Ayn Rand and Murray N. Rothbard instead of F.A. Hayek, libertarianism’s true founder because “American libertarianism began with Hayek” (p. 7).

One reason Koppelman argues that Hayek is properly viewed as the founder of libertarianism is that Koppelman believes that nearly every viable option in today’s political landscape opposes the planned economy that Hayek feared. “Excerpt for a politically impossible fringe, the American left aims for a generous welfare state–more generous than the present one–in the context of capitalism” (p. 4-5). Yes, even Bernie Sanders (p. 5, 35). According to Koppelman, “The ideas of Hayek, valuing markets because they promise a better life for everyone are today commonplace in the Democratic Party” (p. 13). For Koppelman, the enemies of libertarianism come from the right, not the left. Libertarian ideas are threatened by Republican embrace of “Christian fundamentalism and Trumpian racist, xenophobic nationalism” (p. 12).The question then becomes, does Hayekian libertarianism give Koppelman the tools he needs to combat racism? To answer that question, I will examine how Hayek fits into the history of the relationship between libertarian thought and racist thought. Despite attempts at “revisionist” history from twenty-first century libertarians, the libertarian tradition they’ve inherited was either an active participant in building a racist society or passive observers of it. Looking to libertarian ideology to somehow be an active warrior against racism at this late date might be possible, but to do so libertarians need to honestly evaluate their own past.

Page Two will explore these difficulties.

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Another Distorted History of Libertarianism and Racial Justice

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Some religious traditions, most famously, the Church of Jesus Christ of Latter Day Saints, practice the Baptism of the Dead. In this practice, the Church baptizes a living person who is acting as a proxy for a deceased person in order to ensure that that deceased person gains entry into Heaven. Often this practice has met with vigorous objections from leaders of other faiths who find the practice disrespectful to their own faiths.

When libertarians write the history of their ideology in matters of race they tend toward a similar practice. Historical figures are torn from their contexts and declared “libertarians” in order to, metaphorically, get libertarians into the Kingdom of Free Market Heaven. Often the historical figures are a bizarre hodgepodge of folks, usually chosen more for their appealing views on racial justice than on their advocacy of views normally thought of as the centerpieces of libertarian thought such as the non-aggression principle, capitalism, property rights, or strict individualism. The most egregious example of libertarians trying retroactively baptize a historical figure as one of their own is when they try to claim that Martin Luther King, Jr., noted socialist, was a libertarian (examples: here, here, and here).

In their new book The Individualists: Radicals, Reactionaries, and the Struggle for the Soul of Libertarianism, Matt Zwolinski and John Tomasi know better than to try to retroactively enroll MLK as a libertarian, indeed, they point out that many libertarians object to MLK’s ideas (pp. 220, 358). These are real scholars publishing with Princeton University Press, not some blogger on the internet like some people around here. On the other hand, Zwolinski and Tomasi cite a whole lot of bloggers in their chapter on “Racial Justice and Individualism” which is my focus, so perhaps the playing field is more even than I thought.

Zwolinski and Tomasi seem well aware of philosopher Stephen Toulmin’s adage that “Definitions are like belts. The shorter they are, the more elastic they need to be. A short belt reveals nothing about its wearer: by stretching it can be made to fit almost anybody…Yet the hope of hitting on some definition which is at one and the same time satisfactory and brief dies hard” (p. 18). They opt for “satisfactory” rather than “brief” and devote their first chapter to answering the question, “What is Libertarianism?” and draw careful distinctions among “classical liberals,” “neoliberalism,” and “Strict libertarians.” That last category is itself comprised of deontic libertarians, who are guided entirely by inflexible principles and consequentialist libertarians who “evaluates the consequences not of specific policies but of general principles and retains its commitment to those principles even if they (seem to) fail in particular instances” (p. 16). As an aside: keep an eye on that parenthetical “seem to,” it will become important later. Zwolinski & Tomasi often label failures of libertarianism, no matter how big or well documented as seemings. Libertarianism can only “seem” to fail, not actually fail.

Their summary of libertarianism gives us this:

Libertarianism is best understood as a cluster concept. We see libertarianism as a distinctive combination of six key commitments: property rights, negative liberty, individualism, free markets, a skepticism of authority, and a belief in the explanatory and normative significance of spontaneous order. (p. 6)

It is the jockeying among those various elements that make libertarianism so slippery a concept: just which element should be weighted the most, for example? It is also these differing commitments that seem to open the door to reactionary libertarianism. In Zwolinski & Tomasi’s history, libertarianism grew out of an absolute commitment to individualism and negative liberty first embaced by certain 19th century figures’ opposition to slavery. In the twentieth century libertarianism took a reactionary turn in defense of the status quo, and is now embroiled in controversy over which path the “Liberty Movement” will take here in the 21st century: radical or reactionary? (Spoiler alert: they don’t tell you).

I will focus on Chapter 7, “Racial Justice and Individualism” since that is the chapter that is most relevant to my work and expertise. Buckle up and go to page 2.

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South Carolina wants to ban genetic science

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A poem published right after South Carolina started the Civil War declaring they did it for “freedom.”

South Carolina, despite their claims to contrary, has never been a state eager to embrace racial justice. The latest example of the state’s regressive racial thinking is Proposed Bill SC S0424. Like many states ruled by conservatives, the Palmetto State’s legislature is in a tizzy about what they think Critical Race Theory (CRT) is. Because those spreading the moral panic about CRT lie about it and the white legislators who listen to them don’t really care about what CRT actually, many legislatures are proposing the “banning” the teaching of CRT. South Carolina has proposed legislation that is the perfect exemplar of the deep and eagerly embraced ignorance of the anti-CRT crowd. Proposed Bill SC S0424 reads, in part:

(9) an individual must be compelled to affirm, accept, adopt, profess, or adhere to concepts, forms of language, or definitions not firmly and widely established, empirically or scientifically accurate, or that are controversial or theoretical, such as:

         (a) gender theory, including nonbinary pronouns or honorifics;

         (b) unconscious or implicit bias; or

         (c) that race or biological sex are social constructs;

I’m going to leave aside the gender issues in the post and focus on the idea that race is a social construct. It would seem that South Carolina wants to ban ideas like this one:

In one word, the term race is only a product of our mental activities, the work of our intellect, and outside all reality. Science had need of races as hypothetical limits, and these “products of art,” to use Lamarck’s expression, have become concrete realities for the vulgar. Races as irreducible categories only exist as fictions in our brains. They exist in us but not outside us. We can never sufficiently insist on this fact, which is elementary and undeniable to all truly scientific minds and to those desirous above all of ascertaining the truth.

That quotation is not from some wild-eyed “Cultural Marxist” but from French writer, Jean Finot’s book Race Prejudice published in English in 1907. In the subsequent century, Finot has been proven correct, “truly scientific minds” know that “races as irreducible categories only exist as fictions in our brains.” If South Carolina had its way, its schoolchildren would not be taught the best genetic science of the 21st century.

On the next page, I’ll explain why.

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The Survival of the Unfit: Darwinism, Race, and Eugenics in the United States

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This is a paper that I first presented at a workshop at the University of Mississippi in 2012. I submitted it to a journal soon after and got a “Revise and Resubmit.” I then moved, switched computers and it got lost somewhere in all that. When I re-discovered it recently, I realized that it was really too late for me to bring it up-to-date with current work on eugenics given my other writing commitments. Therefore, I decided to post it here for anyone interested in these historical issues. I still like the paper and think it has something important to say.

Abstract: The historical relationship among Darwinism, eugenics, and racism is notoriously difficult to unravel. Eugenicists worried about the “survival of the unfit,” a phrase that should, prima facia, be nonsense for those with a Darwinian worldview in the early twentieth century. To be “fit” in a Darwinian sense meant adapted well enough to the environment to out-survive (and out-reproduce) one’s competitors. For eugenicists, the measure for “fit” could not be those best adapted to the environment in this way because they were concerned with the opposite situation: those who thriving and yet were “unfit.” Additionally, historians now reject the idea that eugenics was necessarily founded on racist assumptions. We can address these problems by examining the different forms of Darwinism adopted by early twentieth-century notions of “fitness” and how the term was interpreted in the context of American debates about immigration restriction and race. For some eugenicists, the idea of panmixia allowed them to argue that the unfit were outcompeting the fit. For others, notably Madison Grant and Henry Fairfield Osborn the idea of organic selection provided them with a Darwinian mechanism that solved the problem of the “survival of the unfit.”

Keywords:  Darwinism; Eugenics; Racism; Fitness; Panmixia; Organic Selection

CONTINUED ON PAGE TWO

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Genetics and Progressives

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Kathryn Paige Harden. 2021. The genetic lottery: why DNA matters for social equality. Princeton: Princeton University Press

Katheryn Paige Harden’s new book, The Genetic Lottery: Why DNA Matters for Social Equality hovers between a plea and a demand that social scientists incorporate behavior genetics into their research. Unfortunately, the book is based on a series of false assumptions about the social sciences that undercut the book’s central thesis.

Social scientists, Harden warns, “have been trained to view the results of behavior genetics with fear and loathing” (p. 277). Indeed, they are guilty of committing a violent crime:

The tacit collusion in some areas of the social sciences to ignore genetic differences…is wrong. It is wrong in the way that robbing banks is wrong. It is stealing. It’s stealing people’s time when researchers work to churn out critically flawed scientific papers, and other researchers chase false leads that go no where. It’s stealing people’s money when taxpayers and private foundations support policies premised on the shakiest of causal foundations. Failing to take genetics seriously is a scientific practice that pervasively undermines our stated goal of understanding society so that we can improve it. (p. 186)

Well, anyone accusing their colleagues of being the moral equivalent of a stick-up artist must have good grounds to do so. Moreover, they must come from a research tradition that has never been guilty of “churning out critically flawed scientific papers!” Unfortunately, Harden misrepresents the fields the criticizes. She shifts standards of evidence to suit her pre-conceived goals. Most importantly, she fails to show that behavior genetics is at all relevant for the values and policies she endorses.

[Continued on page 2]

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Libertarians and Holocaust Denial

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Photo by MARCIN CZERNIAWSKI on Unsplash

After a long covid delay, my paper, “The Pre-History of American Holocaust Denial” is finally published at the journal, American Jewish History. It is part of a special double issue on American antisemitism. The roster of authors is distinguished and I’m honored and delighted to find myself in their company.

Holocaust denial is the idea that the Nazi genocide of European Jews has been greatly exaggerated or, in its most severe form, never actually happened. It is, quite correctly, labeled an extreme form of antisemitism. In the United States, the Institute for Historical Review, founded in the late 1970s. My paper focuses on the decades before that, from the end of World War II to the founding of the IHR.

Here are some of the highlights of my paper:

There is more, all fully documented from archival sources. All of this is not in spite of libertarian ideology but a consequence of it: they were isolationists and were perfectly willing to distort the history of World War II to suit their ends. They made active alliances with overt antisemitic, right-wing activists and, in many cases, shared their antisemitism. It is time the libertarians stopped denying their ugly history regarding Holocaust denial and started taking responsibility for it.


This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.

Eugenics: Not Well-Born

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Karl Pearson, ed., The Treasury of Human Inheritance. (London: Dulau & Co., 1909): 284.

“Eugenics” means “well-born.” The term was coined by Charles Darwin’s cousin, Francis Galton in the nineteenth century. Despite thinking of it as a science, it was not. “Eugenics,” wrote Frank Dikötter, “was not so much a clear set of scientific principles as a ‘modern’ way
of talking about social problems in biologizing terms.” The way to understand eugenics is not as a branch of biology, but a branch of politics. If science asks questions of fact: “What can we discover about the natural world?” politics is about what we should do: “What kind of actions should our society undertake?” Misunderstanding this basic distinction and you misunderstand the nature of eugenics.

Eugenics, which flourished in the years before World War II, was meant to help the human race improve itself by encouraging desirable people to pass on their genes and discouraging undesirable people to pass on their genes. There are lots of problems with this idea: Who decides what’s desirable or undesirable? How do we encourage or discourage people from reproducing? And the history of eugenics includes lots of bad, bad policies. Before World War II, in the United States, eugenic thought contributed to restricting immigration on racial grounds, forcibly sterilizing people against their wills, segregating people in institutions, prohibiting inter-racial marriages, and, in the case of Nazi Germany, contributing to genocide. On the other hand, it did a lot of good like……well…..actually no one thinks anything good came out of eugenics when it was in its heyday. It did great harm and absolutely no good whatsoever.

Naturally, there are people who want to bring it back. Let’s find out why they are wrong.

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Anglo-Saxon Democracy

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British Library, Anglo-Saxon Kingdoms The Eadwine Psalter, Canterbury, ca 1150 On the left Christ freeing Adam & Eve from hell; center, an angel announcing Christ's resurrection to the myrhhbearing women.
British Library, Anglo-Saxon Kingdoms
The Eadwine Psalter, Canterbury, ca 1150
On the left Christ freeing Adam & Eve from hell; center, an angel announcing Christ’s resurrection to the myrhhbearing women.

The rump faction of Pro-Trump America Firsters in Congress have announced a bold, new America First plan to rescue us all from strictly imaginary dangers like election fraud, immigration, solar power, public health lockdowns, the Chinese Commies, and, my personal favorite “progressive indoctrination and enrichment of an out-of-control elite oligarchy,” which I’m pretty sure is me and my friends. Except they spelled “progressive” as “progessive” so maybe they are talking about someone else entirely.

The whole agenda is the unappetizing meal left under the heat lamps on the buffet table of the Trump administration. This, however, caught my eye:

The America First Caucus recognizes that our country is more than a mass of consumers or a series of abstract ideas. America is a nation with a border, and a culture, strengthened by a common respect for uniquely Anglo-Saxon political traditions. History has shown that societal trust and political unity are threatened when foreign citizens are imported en-masse into a country, particularly without institutional support for assimilation and an expansive welfare state to bail them out should they fail to contribute positively to the country.

That whole “Anglo-Saxon political tradition” has an interesting history. I’ve touched on some of this before when I wrote about W. Cleon Skousen, right wing “scholar” beloved of neo-Confederates, right-wing paramilitary troops, and Charles Koch (who says conservatives don’t have a big tent?). His terrible book, The 5,000-Year Leap is filled with references to the Anglo-Saxon traditions upon which this country was supposedly based. As it happens, there is an interesting history in American political thought being invoked here and, of course, it is a racist one. Let’s dig into the Angles and the Saxons and how Americans have abused their name!

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