Rogers M. Smith
This late addition to the Balkinization symposium on
Andrew Koppelman’s Burning Down the
House: How Libertarian Philosophy Was Corrupted by Delusion and Greed,
published in 2022 by St. Martin’s Press, is motivated by the fact that on
January 19th, 2023, the U.S. Treasury reached the national debt
ceiling of $31.4 trillion. Ever since, the Treasury has relied on
“extraordinary measures” to pay the nation’s already incurred debts. The Biden
administration has been urging Congress for months to raise the debt ceiling. Republicans
in the House have recently agreed, with great difficulty, on a bill to raise
the debt ceiling while mandating cuts that the Democrats in the Senate will
never approve, and that President Biden would never sign.
Why is agreement to pay bills the U.S. has already
incurred so difficult? Many conservatives in Congress, particularly the House’s
Freedom Caucus, are so committed to limiting government spending and reducing
the size of the government that they appear willing to compel the nation to
engage in economically catastrophic defaults on its debts rather than raise the
debt limit. Their position has many sources, but the libertarian themes that
Andrew Koppelman analyzes in this book are prominent among them. And
shockingly, it appears that, in the name of their minimal government,
market-centered vision, many libertarians are endorsing violations of the most
basic obligation of market participants, to pay their legally contracted debts,
in ways that may well prove devastating for America’s market capitalist
economic system.
Consequently, it seems more important than ever to understand contemporary libertarianism, its appeal and its deficiencies. Burning Down the House does a masterful job of providing that understanding. Even so, it has some lessons for the contemporary Left that it might emphasize more than it does, and some limitations in understanding the contemporary Right that one hopes its highly accomplished author will address in the future.
First, the lesson for
the Left. Burning Down the House
shows how its author, while still on the Left, while still a critic of aspects
of Hayek and an even greater critic of his libertarian successors, has nonetheless
embraced one lesson from Hayek, and also from Deirdre McCloskey, that few on
the Left will readily conceive. Koppelman has concluded there is considerable
truth to the claim that modern capitalism has generated technology,
commodities, goods and services that have raised the standard of living of even
most of the poor in most of the world. The implication that he slightly
soft-peddles is that the Left today should probably abandon sweeping rhetorical
condemnations of capitalism, satisfying and heart-felt as they often are.
Nonetheless, the true
heart of democratic socialism has always been the aspiration of achieving
responsible democratic control of basic economic institutions. Once that
appeared to mean ownership of the means of production, in major industries at
least, by the democratic state, and extensive policies of state economic
planning. Those are policies that in the Soviet Union certainly meant the
overthrow of capitalism as it is understood elsewhere in the world, though
contemporary China has shown that a central state adopting more limited
versions of those polices—some but less state ownership, some but less state
planning—can achieve remarkable economic growth.
But few on the Left
today take Xi Jinping’s autocratic China as an embodiment of their aspirations.
In any case, for many 20th century socialists the emphasis was
always instead on democratic worker control, not state control, of industries
and corporations. Capitalists in Germany and elsewhere have proven willing to
accept modest worker representation on corporate boards, and though this falls
far short of full worker control, it does suggest that democratic worker
control could be part of what would still recognizably be a capitalist system.
And the reality is
that, for most of today’s Left, what democratic control of the economy now really
means is democratically enacted regulatory and redistributive legislation,
creating social welfare systems and curbing capitalist abuses by limiting
corporate power. That is mostly what Bernie Sanders means by democratic
socialism.
The surprise Burning Down the House provides for many
readers is its evidence that Hayek’s premises and early writings actually
support a good deal of such democratic legislative control of the economy.
Koppelman adds that experience has shown we can have a good deal more than
Hayek wanted, without losing the benefits of productivity and innovation that
capitalist economies at their best provide.
If this is so, and I
think it is so, then more on the Left should say what Elizabeth Warren says:
that she is herself a capitalist, and that we can have a democratic social
welfare and regulatory state in ways that ultimately enable capitalism to
achieve the goals we want it to achieve--more resources for all to fulfill
their preferred ways of life--better than it otherwise would. This “better”
includes regulatory efforts both to restrain capitalist businesses from
practices that are destructive of the environment, non-renewable resources, and
their workers, and to reward innovations that instead help improve the
condition of all concerned. Those are all reasons why a well-regulated welfare
state capitalist system is far more desirable than capitalism under a
minimalist state.
Most on the Left remain
reluctant to acknowledge that what they actually now support is well-regulated
welfare state capitalism, and Koppelman does not rub their noses in that
somewhat uncomfortable reality. But though fiery anti-capitalist rhetoric can
help mobilize many constituencies, it probably is on balance a political
liability, especially since it does not really describe the policies most progressives
now prefer. Koppelman’s arguments usefully point progressives in a different
direction, even more so than he chooses to stress.
They also do so in
another way that Koppelman does not make central in this book, though he has
addressed it in valuable ways elsewhere. Hayek and other libertarians have
always stressed that they favor diversity, in the form of broad freedoms to
pursue a great variety of conceptions of the good life, a great variety of
pursuits of happiness. Today, we most often think of diversity as instead the
cause of the Left, embodied in “diversity, equity, and inclusion” policies and
initiatives.
But one of the
increasingly noted paradoxes of the current political moment is that in many
respects, the notion of “diversity” advanced by today’s progressive Left is
less diverse, less inclusive, than the notions of diversity long put forth by
the best of the libertarian Right. As Koppelman notes, Hayek faced a profound
tension in his thought between his desire for capitalist innovation and
creative destruction that inevitably accompanies it, and his respect for
time-tested traditions and venerable social institutions. But Hayek’s notion of
the diverse goods people can pursue had no trouble treating both the goods of
tradition and the goods of innovation as legitimate goals, even though they
could clash quite fundamentally.
In contrast, for many
on the Left, the pursuit of diversity involves treating as illegitimate most if
not all aspects of those ways of life long associated with many kinds of
racial, gender, religious, and class discrimination, among others. From the
start of his career Koppelman has argued, rightly in my view, that it is
appropriate not only to outlaw most if not all such discriminatory conduct, but
also to foster a culture that deprecates such discriminatory attitudes. But he
has also argued more recently, and also rightly in my view, that if we wish to
promote civil peace, mutual respect, and to gain all the benefits of the
pursuit of diverse ways of life, we should look to find ways to accommodate
more traditionalist ones, if and only if this can be done consistently with the
flourishing of those long subjected to discrimination and disadvantage. We
should, in other words, embrace as far as possible the more expansive and
inclusive conception of diversity that can be found in the best libertarian
thought. This, again, is not a point Koppelman stresses in Burning Down the House, an economics-focused book, but it is
consistent with his book, and worth stressing.
Nonetheless,
Koppelman’s focus on economic libertarianism in his 2022 book does have
limitations in capturing today’s conservatism that are worth stressing. In its
final chapter, focused on Charles Koch, Burning
Down the House sometimes give the impression that Koch was a somewhat
marginal libertarian voice in America until fairly recently, whereas now he and
his Americans for Prosperity organization have become central to American
conservatism. This both understates and
overstates the importance of Koch and his libertarianism in several ways.
As many scholars and
journalists have documented, Charles Koch was one of the wealthy business
recipients of Lewis Powell’s famous or infamous memo to the U.S. Chamber of
Commerce, written and circulated during the first Nixon administration,
contending there was a Left-wing “war on business” in America that needed to be
countered through a long-term campaign to create conservative think tanks,
conservative units within academia, conservative media outlets, conservative
policy advocacy groups, and more. The Koch Brothers were major contributors
from the start of this campaign not just to AFP but also the Heritage
Foundation, the Cato Institute, the State Policy Network creating conservative
think tanks in every state, ALEC, and many more—all pushing some form of
economic libertarianism, and many promoting the extreme, Murray Rothbard and Ayn
Randian variants, that Koppelman effectively demolishes in his book. What Burning Down the House somewhat
understates is that Charles Koch and his libertarian allies have been major
forces in American politics and cultural life for over forty years.
More significantly, what
the book somewhat overstates, at least by implication, is the centrality of
these extreme libertarians to American conservatism now. They remain very
important, as the refusal to raise the debt ceiling and much else demonstrate.
But the rise of Trump and the National Conservatism Movement, the intellectual
wing of the “MAGA” movement, have shifted the picture more than Burning Down the House conveys.
Koppelman does briefly note
that Trump is an economic protectionist, with trade policies that are anathema
to libertarians; that he criticizes libertarian attacks on Medicare and Social
Security; and that he has racial and xenophobic themes, including vilification
of immigrants, that the best libertarians firmly reject. But what he misses is
first, that new organizations promoting these Trumpian or National Conservatism
themes have been proliferating rapidly in recent years; second, that even some
organizations that were formerly part of the Koch libertarian network have
converted to these positions; and third, that these new conservative themes
include attacks on large corporations and wealthy elites in the name of working-class
Americans of a s
ort that Charles Koch
could never endorse, and now actively works to oppose. There is a major new
battle for the soul of modern conservatism that is largely absent from this
book.
For example, at the end
of the Trump administration, a number of its alums along with other leading
conservatives set up the America First Policy Institute, with 20 centers that
address a wide range of issues, including economic ones. Some of these AFPI
centers explicitly attack Koch-style thinking and conduct. The Center for
American Trade, for example, denounces the “D.C. and global corporate elites”
who “in the name of free trade orthodoxy, allowed markets and market
efficiencies to be an overwhelming influence on policy decisions” (Center
for American Trade (americafirstpolicy.com). They call for
an end to economic policies “for the sake of big finance and big business,” and
declare America’s workers, not its capitalists, to be the “class of Americans
who made our Republic the greatest nation on earth.” Many current conservatives
like Florida Senator Marco Rubio also now regularly berate “woke capitalists”
and “woke corporations” because of their Diversity, Equity, and Inclusion
offices and initiatives, linking the racial concerns of the MAGA movement with
these conservatives’ heightened criticisms of big businesses.
Perhaps the best
summary of this powerful strain in contemporary conservatism is the National
Conservatism Statement of Principles, published in 2022, after Burning Down the House was completed (National
Conservatism: A Statement of Principles - National Conservatism).
The Statement was signed by leaders of Hillsdale College, National Review, the
Conservative Partnership Institute, the Hoover Institute, the Hudson Institute,
the Claremont Institute, the Intercollegiate Studies Institute, the Edmund
Burke Foundation, Turning Point USA, the Manhattan Institute, and more. It
insists “the free market cannot be absolute” and rails against “trans-national
corporations showing little loyalty to any nation” who “damage public life by
censoring political speech, flooding the country with dangerous and addictive
substances and pornography, and promoting obsessive destructive personal
habits.” The Statement avers that a “prudent national economic policy should
promote free enterprise, but it must also mitigate threats to the national
interest…nurture industries crucial for national defense, and restore and
upgrade manufacturing capabilities critical to the public welfare,” although
“Crony capitalism, the selective promotion of corporate profit-making by organs
of state power, should be energetically exposed.” For a book on contemporary
racial politics that Desmond King and I are completing for the University of
Chicago Press, we have looked at the websites of most of the organizations that
are part of the State Policy Network established partly with Charles Koch’s
aid. Some retain fundamentally economic libertarian, Koch-style policies and
programs. Many others, however, like the Texas Public Policy Foundation, one of
the biggest and one that was formerly headed by Brooke Rollins, who now leads
the America First Policy Institute, have gone over entirely to this sort of
anti-corporate, anti-fully free trade, anti-fully free market rhetoric.
I don’t want to
overstate this development. These new groups all want to cut taxes, eliminate
lots of regulations, promote privatization of many governmental services, and
to enact much else in the libertarian agenda that Koppelman explores. Still,
there is a meaningful distance between them and Charles Koch; they have deep
wells of alternate funding; and Koch and like-minded libertarian conservatives
have in some cases sought to defeat the anti-big business candidates that the
“national conservatism” Right often favors.
Consequently, we must
recognize that the libertarianism that is the subject of Burning Down the House is not the whole story of contemporary
conservatism. It remains, however, an extremely important part of the story,
again as the debt ceiling crisis indicates. Koppelman has depicted and
critiqued this libertarianism extraordinarily well, and all his readers will be
in his debt—though as I’ve noted, whether we are all still obliged to pay our
debts is now very much in dispute.