Tuesday, December 15, 2009

Hayek and Spontaneous Order at Cato Unbound

following posting is in response to a series of articles discussing the nature of Friedrich von Hayek’s theory of spontaneous order at Cato Unbound. The first article is Four Problems with Spontaneous Order by Timothy Sandefur, with responses by John Hasnas, Daniel Klein, and Bruce Caldwell (the last of whom I met at a Hayek conference this past summer), and then a response to them by Sandefur. I’m going to make comments on each, in order. I am very much in disagreement with Sandefur, but I think some of the defenses of Hayek fall a bit short, which I’ll be taking up. Those who number their points, I’m numbering along with them.

Sandefur

1) The main problem that I see with Sandefur’s argument is that he doesn’t seem to know the difference between a spontaneous order and an organization. If you don’t understand this distinction, of course you think the difference is merely a matter of distance. He is mistaking lions for the savannah ecosystem in which they live. A lion is an entity with goals. An environment or ecosystem cannot have goals – any more than can a spontaneous order, which is a kind of human social ecosystem. His examples of micro- and macroevolution fails because evolution happens at the level of organisms/entities and, as already noted, a spontaneous order is more akin to an environment or ecosystem.

Now when it comes to law, one can argue that law as a whole should have never been considered a spontaneous order by Hayek precisely because it is constructed in legislation. One can nevertheless conclude that social norms of behavior are a spontaneous order. The fact that a spontaneous order can be co-opted and turned into a constructed order is no argument against the existence of spontaneous orders as distinct from constructed orders.

2) In spontaneous orders, we have naturally emerging bonds being made and broken between agents/entities. This results in maximum information flow, as occurs when we have a scale-free network. Interference in that process forces the maintenance of bonds that would have otherwise broken or the breaking or even prevention of making bonds that would have otherwise existed. The result is a rigid hierarchy. These bonds are not as concrete as Sandefur’s example.

If equality under the law is good and the increase of wealth and knowledge are good (meaning, the more rapid the increase, the better), then spontaneous orders are superior to constructed orders. This kind of equality (under the law) is necessary for the creation of a spontaneous order, which in turns increases wealth and knowledge. I suppose if one does not think that more wealth and knowledge are good. Then one would not see spontaneous orders as good, but even dictators pretend to what at least more wealth (though the consistent outcomes of attempts at constructed orders making less wealth, indeed, decreasing wealth, suggests otherwise for current defenders of such systems). A spontaneous order is therefore good because it is good for and good at producing wealth and knowledge. What people do with that wealth and knowledge is outside the realm of the spontaneous order proper, and therefore one should not criticize the spontaneous order for creating these things agents within the system misuse. One should keep one’s criticisms for the agents themselves. Thus, spontaneous orders in this sense are amoral, being ateleological.

3) Sandefur has a point when it comes to Hayek on morals, law, and legislation, but spontaneous orders can be rescued from Hayek’s own arguments of social constructivism with the recognition that humans do have instincts, including moral instincts (see Marc Hauser’s Moral Minds that lay a foundation for behavior and for judgment. More, humans have paradoxical drives that spontaneous orders can emphasize or play down, depending on the order. Sandefur also misses the point that different systems have their own internal logics and, therefore, different criteria for rational behavior. Hayek is warning against importing the rules form one spontaneous order into another just as much as he warns against arbitrary rules. More, the system should be judged by the outcome of the system, not by how some particular elements in the system are doing. This also answers his first paragraph of his response paper.

4) Sandefur does not seem to understand what really happened with his contrary examples. In the case of segregation, laws were on the books in the states to prevent social evolution. Tradition is not stagnant and unchanging, as anthropologist Victor Turner discovered. Our society, by the 1960’s, had evolved to a point where the people themselves as a whole wanted legislative change. The laws in the South were designed to prevent natural interactions from occurring, whether in the economy, socially, etc. The law changed after society did. The fact that the federal laws overturned state and local laws is no argument that the change didn’t begin as a spontaneous order, even if it did end in legislation. This kind of legislation always follows social change – it never leads it. The same is true of his other example, Lawrence v. Texas. Attitudes toward homosexuality had changed so much by then that the laws had to catch up with the prevailing morals. The presence of those who resist any such change is no argument against spontaneous order. In fact, to insist that tradition as Hayek understood it means stagnation is to ignore the fact that spontaneous orders are by definition dynamic. Tradition for Hayek is a touchstone helping keep the system stable – it is not ossification of the system (making it no longer a system). The judges’ behavior in Lawrence v. Texas was rational within the system that had evolved by the time of the decision. It would not have been considered – or considered rational – a hundred years earlier. But the evolution that led to that decision was bottom-up.

Hasnas

1) Hasnas is generally correct in his defense of the idea of spontaneous orders, but he also leaves out the issue of teleology. Organizations are teleological – they have a goal, a purpose. Spontaneous orders are non-teleological – they do not have a goal. When a leader says, “We need to pass X to create more jobs in the economy,” that leader is treating the economy as a teleological organization. Stalin’s infamous five-year plans did the same thing. On the other hand, a leader who says, “We need to pass X so companies will be more productive and make greater profits,” is not thinking of the economy as a made order, but as a spontaneous order in which there are made orders that will react in different ways to the proposed change. That may increase general employment – or it may not. But the rule change does not address the spontaneous order as such, only the elements within it and their interactions.

2) Hasnas does an excellent job refuting Sandefur’s second point, to which I have nothing more to add than what I said above in my initial response.

3 & 4) Hashas is generally correct that Hayek’s judicial and moral philosophizing has much to be desired – however, I think he does lend short shrift to the idea of spontaneous order in these realms. As I argued above, Hayek mistakenly decouples the spontaneous orders from our evolved instincts, and this includes our morals. There is room for ethics to evolve while being rooted in moral instincts. Just as much, moral reasoning evolves in such a system, making us able to critique and criticize. Still, we remain tethered to our evolved morality. We need all three: moral instincts, evolving tradition, and moral reasoning.

Klein

I think Klein gets to be a bit too cute with his idea of Hayek’s “code” – “custom” is not necessarily “liberal principle” (in fact, almost by definition, customs are not liberal in principle, but conservative in fact), “competition” is really economic competition, not freedom per se (though freedom of interaction does allow for and is a necessary foundation for true competition), and “the market” is by definition free of interference. He is correct, however, in identifying “spontaneous” with “free,” as one cannot be spontaneous without the freedom to do so.

His argument falls a bit short when he discusses what Hayek means by order. Certainly he “get it,” but he doesn’t go far enough in explaining what is meant. Critics of the market argue that the market is too “disorderly” and that the government is needed to make it “orderly.” The kind of order they mean, of course, is regular order – the kind of order found in crystals. Hayek argues for a kind of order that lies between “order” and “disorder,” one which creates patterns (of behavior in the case of spontaneous orders) that are not rigidly ordered, but not random, either. A good visual example is the self-organizing fields of rocks in Antarctica.

Caldwell

Caldwell is good to point out we need some historical context. That always helps us to understand what we are reading. However, we need to do better than “I know it when I see it.” That is what we’re trying to do at the Fund for Spontaneous Orders at the conferences and at Studies in Emergent Order.

Sandefur II

In his response, Sandefur continues in his error of thinking a corporation is a spontaneous order, which it clearly is not (nor did Hayek ever claim them to be). In fact, the core of his error in thinking is is not recognizing this difference. A spontaneous order is made up of various agents and organizations, each of which is behaving in a purposeful manner – but these interactions result in a spontaneous order with no goal or purpose. He essentially argues that, because lions are in an ecosystem, and because they interact with various other elements in an ecosystem, one cannot therefore distinguish between a lion and its ecosystem! Both may be complex adaptive systems (CAS), but they are different kinds of CAS’s. A spontaneous order is a very different kind of CAS than is an organization. The fact that both are CAS’s does not mean spontaneous orders cannot be distinguished from other CAS’s. This is essentially the logical error of “All lions are cats,” therefore “All cats are lions.” To Sandefur, house cats are really lions because both are cats.

His example of nationalized health care as appearing to not be a constructed order fails miserably because, apparently, for him, only one person can be involved in construction. There must be a goal in constructing a building, but does that mean only one (or a small group) is involved> Hardly. One could make a list as long as his of people necessary to construct a building – and a building could never arise through spontaneous order. Spontaneous orders just don’t order that way. Many people are coordinating to a common purpose to create a teleological system in nationalized health care. That makes it a constructed order. Next, it is imposed from the top-down. That “top” may be fairly large, but in the end it is a top-down construction. Just because a few bones are thrown to the hoi polloi to settle them down doesn’t mean a bottom-up process was used or in play.

His example of Wal-Mart fails because he fails to recognize that in a corporation, there is a hierarchy. There may be local centers of decision-making, but such a system is not truly decentralized, let alone scale-free. And there is not freedom of entry and exit. Those are decisions made by someone. I can’t just go open up a Wal-Mart because I decided to one day. A spontaneous order has these features; Wal-Mart does not.

In the end, Sandefur cannot even seem to understand the difference between a bottom-up social reformer who tries to persuade people and a top-down social reformer who uses the power of the state to impose his vision on everyone, whether they like it or not, whether it maps well onto human nature of not. The former is part of the spontaneous order; the latter destroys it. If Sandefur cannot understand that basic distinction, of course he cannot see the difference between spontaneous and constructed orders – nor can he tell the difference between freedom and dictatorship.

8 comments:

John said...

I can't get the Hauser link to work.

Troy Camplin said...

Taken care of

John said...

Ah. None of the other ones work either.

Troy Camplin said...

Taken care of.

Timothy Sandefur said...

Mr. Camplin,

I assure you I'm not quite so stupid as you suggest. Nor am I denying that there are such things as spontaneous order. In fact, you appear to misunderstand the point I'm making when you say that a spontaneous order has no goals. I agree with that--you're right that an ecosystem is a spontaneous order. The point I'm making is that precisely for that reason, the concept of spontaneous order cannot offer us any guidance in our choices. That's because whatever the lion does--whether he eats the antelope or not--the result is still "ecosystem." That is, no matter what you do, your intentional actions will result in a consequential "spontaneous order." So spontaneous order is a useful descriptive concept: it's certainly true in the case of ecosystems and whatnot. But it can't serve as the foundation of any argument against constructed order. Spontaneous orders, in fact, are accumulations of constructed orders.

You say that I'm committing the fallacy of saying that because all lions are cats, therefore all cats are lions. Not at all. What I'm saying is that spontaneous orders are the large scale, unintended, unplanned, non-intentional orders that grow, or emerge, from the intentional interactions of individuals. That means that no matter what action you choose, there will be a spontaneous order that grows up around it. And that means that no matter how constructed or intentional one action is, if you look at it from a distance, you see that a spontaneous order has grown up around it like ivy around a brick wall--unintentionally, and unplanned. And that is true no matter what kind of brick wall you build. That means that a person can't criticize planning qua planning--since in the long run it's all just a component of spontaneous order. See what I mean? I'm not denying the reality of spontaneous order at all, or (so far as I can tell) mischaracterizing what a spontaneous order is.

As to race relations. You're right that segregation was implemented by law to prevent social evolution. I didn't say otherwise. (Actually, I referred to slavery, not to segregation.) In fact, this is the common pattern: as long as people aren't really challenging a spontaneous order very much, there's no need for legislation. It's when people challenge the prevailing order--try to revolutionize it by consciously imposing their abstract conceptions of justice--that the reactionaries adopt laws to stop this. That's why more people were burned at the stake in the Renaissance than in the Dark Ages: because there were more free-thinkers then. None of this changes my point that injustice is very often the product of spontaneous convention and not of legislation--slavery being the prime example.

You say that I "cannot even seem to understand the difference between a bottom-up social reformer who tries to persuade people and a top-down social reformer who uses the power of the state to impose his vision on everyone, whether they like it or not." But Mr. Camplin, Hayek himself refuses to use coercion as the basis of distinguishing spontaneous and constructed orders. I actually think his argument would have been a lot stronger if he had used this as the boundary--as I said in the first few paragraphs of my first essay. But he refused to do so because, among other things, that would have required a normative account that would be way too much like rational constructivism. So the problem isn't that I "cannot even seen to understand the difference" between coercion and free exchange--it's that Hayek refused to employ this difference in his writings...and I'm the one complaining about that.

I hope this clarifies my arguments some.

Troy Camplin said...

Mr. Sandefur,

I appreciate your coming here to leave comments. I certainly do not think you stupid -- I was only arguing that you have made several categorical mistakes. The world is full of intelligent, educated people who make such mistakes. I will take you at your word that you do see a distinction between constructed and spontaneous orders, but your essays appear to make the opposite argument, including the following: "The difference between constructed and spontaneous orders, in fact, begins to look more like the difference between microevolution and macroevolution in biology. Whatever use that distinction might have in some contexts, it is not a distinction in principle." You also argue that distance matters in something being a constructed vs. a spontaneous order. All of these arguments seem to suggest you at least do not see the distinction Hayek sees between the two. Also, the title of your pice is "Four Problems with Spontaneous Order," not "Four Problems with Hayek's Concept of Spontaneous Order."

The difference between a constructed order and a spontaneous order, as Hayek himself observes, is that constructed orders are constructed from the top-down. A planned economy is a constructed order -- it is not at all spontaneous. Spontaneous orders are bottom-up. More, they require equality of status, general rules, and freedom of entry and exit. Those are basic. Now, a command-and-control economy, a free market economy, and a mercantilist economy are all complex adaptive social systems, but only one of them has all three qualities of equality of status, general rules, and freedom of entry and exit. The free market is a spontaneous order precisely because it has those three features. A constructed order does not and will not have those qualities. In any system that has these qualities and is ordered from the bottom-up, coercion will not be present. The constructed order will necessarily be coercive in nature. Perhaps Hayek is less than clear on this point, but I very much understand this to be the case. You bring up the case of slavery as an example of something that arose spontaneously. Yes, it did, but that doesn't make it a product of a "spontaneous order." The only similarities here are the use of the word "spontaneous". By the definition of spontaneous order, one cannot have slavery and have a spontaneous order. I would say that slavery arose "naturally," and that it was discarded by an evolved moral sense that helped to lay the groundwork for the emergence of spontaneous orders.

A small thing: you mention "freedom riders," which was to protest segregation, not slavery.

In the end, here is the logical fallacy you are still committing: "All spontaneous orders are complex adaptive social systems" therefore, "All complex adaptive social systems are spontaneous orders." There are many kinds of complex adaptive social systems, but only a few spontaneous orders -- which have arisen primarily in the recent past. Now, if you want to argue that Hayek is wrong to consider certain complex adaptive social systems spontaneous orders, then you and I are in agreement. But one cannot fault one of the founding thinkers of an idea with not solving all the problems surrounding it.

Robert Canright said...

I am currently reading Hayek's "The Constitution of Liberty." I'm glad to run across others who have already read it!

Anonymous said...

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