Page 38 - Šolsko polje, XXIX, 2018, no. 1-2: The Language of Neoliberal Education, ed. Mitja Sardoč
P. 38
šolsko polje, letnik xxix, številka 1–2
State intervention is necessary for the ordo Liberals in order to es-
tablish the conditions under which laissez-faire can effectively oper-
ate. Indeed, Eücken appears to be quite dismissive of what is central to
laissez-faire:
The solution to the problem of control was seen by [the advocates of
laissez-faire] to be in the ‘natural’ order, in which competitive prices au-
tomatically control the whole process. They thought that this natural
order would materialise spontaneously and that society did not need
to be fed a ‘specific diet’, that is, have an economic system imposed on
it, in order to thrive. Hence, they arrived at a policy of laissez-faire; this
form of economic control left much to be desired. Confidence in the
spontaneous emergence of the natural order was too great. (Eücken,
1989: p. 38)
This interventionist current in liberal thought was alive and well in
America amongst other liberals than Henry Simons. James Buchanan,
the founder of Public Choice theory, shares with the ordo liberals this
more directive orientation to state action. Although the classical liberal
tradition had stressed the role of markets as ‘self-regulating,’ represent-
ing a strong commitment to liberalism as a naturalistic doctrine, and as
supported by arguments based on the freedom of the individual from the
state, Buchanan so distrusted that the required efficiency gains would
emerge through automatic mechanisms of the market that, in a way sim-
ilar to writers like Röpke and Eucken, he supported efficiency achieve-
ments through a the deliberate tightening of state control. As he says in
his criticism of Hayek:
My basic criticism of F. A. Hayek’s profound interpretation of mod-
ern history and his diagnosis for improvement is directed at his appar-
ent belief or faith that social evolution will, in fact, ensure the survival
of efficient institutional forms. Hayek is so distrustful of man’s explicit
attempts of reforming institutions that he accepts uncritically the evolu-
tionary alternative. (1975: p. 194n)
It was on this ground that he opposed Hayek’s naturalist faith in
markets as spontaneous self-ordering systems which had been the hall-
mark of the classical liberal view since its inception. In Buchanan’s view,
the state should actively construct the competitive market economy and
utilise supply-side monitoring in the interests of promoting efficiency in
market terms.
36
State intervention is necessary for the ordo Liberals in order to es-
tablish the conditions under which laissez-faire can effectively oper-
ate. Indeed, Eücken appears to be quite dismissive of what is central to
laissez-faire:
The solution to the problem of control was seen by [the advocates of
laissez-faire] to be in the ‘natural’ order, in which competitive prices au-
tomatically control the whole process. They thought that this natural
order would materialise spontaneously and that society did not need
to be fed a ‘specific diet’, that is, have an economic system imposed on
it, in order to thrive. Hence, they arrived at a policy of laissez-faire; this
form of economic control left much to be desired. Confidence in the
spontaneous emergence of the natural order was too great. (Eücken,
1989: p. 38)
This interventionist current in liberal thought was alive and well in
America amongst other liberals than Henry Simons. James Buchanan,
the founder of Public Choice theory, shares with the ordo liberals this
more directive orientation to state action. Although the classical liberal
tradition had stressed the role of markets as ‘self-regulating,’ represent-
ing a strong commitment to liberalism as a naturalistic doctrine, and as
supported by arguments based on the freedom of the individual from the
state, Buchanan so distrusted that the required efficiency gains would
emerge through automatic mechanisms of the market that, in a way sim-
ilar to writers like Röpke and Eucken, he supported efficiency achieve-
ments through a the deliberate tightening of state control. As he says in
his criticism of Hayek:
My basic criticism of F. A. Hayek’s profound interpretation of mod-
ern history and his diagnosis for improvement is directed at his appar-
ent belief or faith that social evolution will, in fact, ensure the survival
of efficient institutional forms. Hayek is so distrustful of man’s explicit
attempts of reforming institutions that he accepts uncritically the evolu-
tionary alternative. (1975: p. 194n)
It was on this ground that he opposed Hayek’s naturalist faith in
markets as spontaneous self-ordering systems which had been the hall-
mark of the classical liberal view since its inception. In Buchanan’s view,
the state should actively construct the competitive market economy and
utilise supply-side monitoring in the interests of promoting efficiency in
market terms.
36
