Capabilities and Libertarianism Part III: Capabilities for Neoclassical Liberals

So far I have discussed how some forms of libertarianism cannot be justified for reasons any self-respecting capabilitarian would accept. I know of no libertarian who works explicitly within a capabilities framework, but some libertarians hint at capabilitarian inclinations. For libertarianism to be justified in terms of the capabilities approach, libertarian principles would be affirmed and defended because they advance human capabilities. Some libertarians, especially those I discussed in the previous post, believe liberty means freedom only from violent interference, especially government, whose violence is seen as legitimate. This view is insufficient to satisfy the multi-value, outcome-conscious capabilities approach. Yet one can also understand liberty as having positive and negative types, where negative liberty refers to freedom from interference and positive liberty refers to freedom to (do) stuff. This concept of positive liberty can get us quite close to capabilities.

The Neoclassical Liberals

Jason Brennan and John Tomasi have described the emergence of a gaggle of libertarian philosophers advancing “neoclassical liberalism“, a view combining the high liberal commitment to social justice with a robust defense of economic liberty on ethical — as opposed to merely instrumental — grounds.

Neoclassical liberalism concurs with Marxism that citizens should have the effective means to exercise their wills, to do as they please (provided they do not violate other citizens’ rights), and to lead their conceptions of the good life. Neoclassical liberals agree with high liberals that citizens should have the effective means to face each other as free and equal.

Neoclassical liberals argue that negative liberty matters in part because, historically, protecting negative liberties has been and will continue to be the most important and effective way of promoting positive liberty. Thanks to economic, cultural, and scientific growth, a typical citizen of a Western nation today enjoys far more positive liberty than a medieval king. This growth did not occur because a government declared or legally guaranteed that it would occur. It occurred because Western countries adopted functional background institutions, institutions that, over time, gave citizens the incentives and means to promote positive liberty through their commercial, literary, scientific, and cultural activities. In practice, promoting positive liberty does not come at the expense of negative liberty, as Berlin worried. Instead, positive liberty is promoted by respecting negative liberty.

The point for both high and neoclassical liberals is to kindle autonomy for all and make it possible for each individual to lead the kinds of lives they have reason to value. While neoclassical liberals argue that protecting negative liberties will foster positive liberties to a great degree, most also acknowledge the necessity of state action to provide positive liberties when private actions fail to do so.

A good example of this is the enthusiasm among some libertarians for a universal basic income. Matt Zwolinski has written on this topic at a number of different venues. Capabilitarianesque motivations are particularly evident in his exploration of Friedrich Hayek’s support for a basic income.

But even if market competition is often a good check against private dominance, there is no good economic reason to believe that it will always be sufficient. Can we really dismiss the possibility that hard economic times, combined with an excess supply of labor and a small number of employers, will leave some employers with considerable market power over their workers? Are we really willing to say that each and every one of the outrages documented by Bertram et al. [link] is the product of workers’ free choice, rather than (what they appear to be) something imposed on workers against their will by those who wield power over them?

If libertarians are concerned to protect the freedom of all, and not just the freedom of most, we will want some mechanism that catches those who fall through the cracks left by imperfect market competition. We will want, too, some mechanism for protecting individuals whose economic vulnerability renders them vulnerable to domination outside the marketplace – the woman, for example, who stays with her abusive husband because she lacks the financial resources to support herself without him.

Cases such as these point the way to a freedom-based case for a Basic Income Guarantee, of the sort that Hayek might very well have had in mind. A basic income gives people an option – to exit the labor market, to relocate to a more competitive market, to invest in training, to take an entrepreneurial risk, and so on. And the existence of that option allows them to escape subjection to the will of others. It enables them to say “no” to proposals that only extreme desperation would ever drive them to accept. It allows them to govern their lives according to their own plans, their own goals, and their own desires. It enables them to be free.

Zwolinski and Hayek are concerned that mere equality before the law does not ensure meaningful freedom. Private sphere power relations having nothing to do with government can thoroughly inhibit the actual exercise of personal agency.

But why capabilities?

The neoclassical liberals have engaged constructively with high liberalism, a family of ideas containing the capabilities approach. But as far as I’m aware (I’m eager to be corrected), the neoclassical liberals have focused on Rawlsian conceptions of liberalism. It’s reasonable to question why I’m specifically concerned with a libertarian engagement with the capabilities approach. I have two basic reasons. First, it’s possible the neoclassical liberals may find a more receptive audience among the capabilitarians. Second, in my view the capabilities approach is the evaluative gold standard. It’s more demanding than the “justice as fairness” of Rawls. If you can do capabilities, you can do anything.

Ingrid Robeyns has written a recent article attempting to clarify the core commitments of the capabilities approach. She even mentions the possibility of a libertarian capabilities approach. Emphasis in original.

The question of what, if anything, the government ought to do depends on the exact reach of the capabilitarian theory one is defending but also on the answer to the question of whether we need the government to deliver those goods and what can realistically be expected from a government. Just as we need to take people as they are, we need not work with an unrealistic utopian account of government. It may be that the capabilitarian ideal society is better reached by a coordinated commitment to individual action or by relying on market mechanisms.

[…]

Clearly, most political philosophers believe that in order to provide public goods and to solve collective action problems that are needed to reach certain levels of capabilities, we need a strong government. But not everyone agrees; in fact, anarchist thinkers vigorously disagree, and adherents of public choice would stress that giving the government the power to deliver those goods will have many unintended but foreseeable negative consequences, which are much more important than the positive contributions the government could make. Thus, while at the descriptive level it is true that most capabilitarian scholars envision a considerable task for the government and public policy, conceptually, there is no reason to believe that this needs to be the case.

What a gracious invitation to dialogue! I suspect there may also be more overlap between neoclassical liberals and capabilitarians than with other high liberals. In addition to the empirical dispute about the consequences of focusing on negative liberty, neoclassical liberals and high liberals disagree about the role of private property rights and economic liberty. High liberals grant a role for economic liberty, often grudgingly, on instrumental grounds alone, whereas neoclassical liberals view private property and substantive economic liberty as an important form of liberty all its own. But at least some prominent capabilitarians reserve an important role for economic liberty as well. Martha Nussbaum, who is generally skeptical of libertarians and their economics, nevertheless includes in her list of ten central capabilities “being able to hold property (both land and movable goods), and having property rights on an equal basis with others ….” (Frontiers of Justice).

Amartya Sen is more emphatic in his support for economic liberty. In Development as Freedom, he acknowledges the instrumental case for economic rights, which “is certainly strong, in general, and there is plenty of empirical evidence that the market system can be an engine of fast economic growth and expansion of living standards.” But he also offers the following argument that has nothing whatsoever to do with efficiency:

[A] denial of opportunities of transaction, through arbitrary controls, can be a source of unfreedom in itself. People are then prevented from doing what can be taken to be — in the absence of compelling reasons to the contrary — something that is within their right to do.

Sen continues with a thought experiment:

Even if in both scenarios (involving, respectively, free choice and compliance to dictatorial order) a person produces the same commodities in the same way and ends up with the same income and buys the same goods, she may still have very good reason to prefer the scenario of free choice over that of submission to order. There is a distinction between “culmination outcomes” (that is, only final outcomes without taking any note of the process of getting there, including the exercise of freedom) and “comprehensive outcomes” (taking note of the processes through which the culmination outcomes come about) … . The merit of the market system does not lie only in its capacity to generate more efficient culmination outcomes.

As I say, the capabilitarian and the libertarian should be friends. But it’s not all sunshine and rainbows. Neoclassical liberals can make a strong, and in my view successful, case that their frameworks for an ideal society satisfy Rawlsian requirements for social justice (roughly, that the worst off in society benefit from the inequalities allowed under neoclassical liberal institutions) because that case is easy. Capabilities is harder. To see this, it’s worthwhile to take a look into why capabilitarians themselves do not settle for mere Rawls.

Nussbaum, again in Frontiers of Justice, criticizes the theoretical assumptions underpinning the contractarian “justice as fairness” of John Rawls. Rawls assumes that the principles of justice can be determined by imagining everyone getting together behind a “veil of ignorance” so that they have no prior knowledge of their status in actual society; behind this veil, they simply hash out whatever principles of justice they can all agree to. Leaving be the heroic assumption that different minds, even without knowledge of their social standing, could come to such agreement, it’s important to ask Who are these people? He assumes they have the following qualities: they are roughly equal in mental and physical resources, such that no one of them can dominate the rest; they are free; they are independent of one another in projects and interests; and they are interested in cooperation for the sake of mutual advantage. Nussbaum notes that the assumptions of equality and independence preclude those with mental impairments from the bargaining table. Furthermore, the assumption of self-interest among the parties precludes their interests from being represented at all. These assumptions seem to be motivated by a desire for a robust result derived from parsimonious assumptions, but as Nussbaum notes,

It is uncertain that this parsimonious starting point will even lead in the same direction as a more sympathetic and other-oriented starting point. The pursuit of mutual advantage and the success of one’s own projects is not less than a compassionate commitment to the well-being of all human beings; it is just different.

This may only be of theoretical interest, and may only impact those neoclassical liberals who have developed theories based on a social contract model (John Tomasi, for example, at least in “Free Market Fairness“; and the critique seems apposite for public reason theories as well, like that of Gerald Gaus). But these assumptions limit formal justice to those seen as “contributors” to the public pool and relegate the welfare and flourishing of net or lifelong dependents as well as foreigners (who may not be seen to contribute to the same social contract) to considerations of charity and benevolence. Perhaps this is enough, and I don’t claim that any of the neoclassical liberals oppose, say, tax-funded programs for orphans and the mentally impaired (unless they specifically argue that the state will make things worse). Apart from the theoretical interest, these assumptions about justice risk influencing our thinking in real life contexts, and dignity and justice may (continue to) be denied to those neglected by our theorizing. For Nussbaum, the capabilities approach “envisages human beings as cooperating out of a wide range of motives, including the love of justice itself, and prominently including a moralized compassion for those who have less than they need to lead decent and dignified lives.”

For a less theoretical example, consider material inequality, which neoclassical liberals typically view as irrelevant to considerations of social justice as long as the needs of all people are met according to some standard of decency (the “sufficientarian” criterion). I’m sympathetic to this view. But in contrast, Sen (Development as Freedom) suggests that “Being relatively poor in a rich country can be a great capability handicap, even when one’s absolute income is high in terms of world standards.” He goes on,

For example, the difficulties that some groups of people experience in “taking part in the life of the community” can be crucial for any study of “social exclusion.” The need to take part in the life of a community may induce demands for modern equipment (televisions, videocassette recorders, automobiles and so on) in a country where such facilities are more or less universal (unlike what would be needed in less affluent countries), and this imposes a strain on a relatively poor person in a rich country even when that person is at a much higher level of income compared with people in less opulent countries.

This is a 90’s variation of the well-worn “hedonic treadmill”, and yet we shouldn’t dismiss the critique. It is easy to moralize this issue and say poor folks should prioritize better. They should be comfortable living with the technologies of yesteryear and generic brands and styles of clothing, etc., if this is what they can afford. They are, after all, much better off than their ancestors or those living in poorer countries. Consider, though, how our intuitions change when poor individuals do not themselves mimic the rich, but instead finance the appearance of greater social standing for their children. I suspect we’re more sympathetic to the “strain on the relatively poor” parent who struggles to free their children from social exclusion. I am not proposing material egalitarianism, but denying there is any moral element to material inequality seems to deny human nature. But perhaps there is no conflict if the sufficientarian requirement of social justice acknowledged by neoclassical liberals is so conceived as to accommodate dignity or social standing, thereby blurring the lines between sufficientarianism and egalitarianism.

Conclusion

I have suggested in this post that the neoclassical liberal variants of libertarianism, in stark contrast to the bullet-biting libertarianisms of the previous post, stand a fair chance at satisfying the stringent justificatory requirements of the capabilities approach. I believe neoclassical liberalism can surmount the few examples of potential disagreement between these schools I was able to conjure up. I say “potential” because, frankly, I’m not an expert on the detailed philosophical arguments of all of the neoclassical liberals I’ve mentioned, and I hope I have misrepresented no one. I am merely a concerned lay person, and my purpose in writing this series is to encourage the actual trained philosophers within these two schools to engage with one another.

In the final post, I will suggest how libertarians may be able to provide useful guidance for capabilitarians, including an appreciation of spontaneous order, public choice concerns, a sensitivity to coercion, and a respectful skepticism of democratic procedures.

One thought on “Capabilities and Libertarianism Part III: Capabilities for Neoclassical Liberals

  1. Paul Crider

    Regrettably, this was a really long post. Also regrettably, keeping it as short as it is required some trimming. I excised this money quote from Kerry Howley:

    Liberty—from government, from tradition, from prejudice—must be taught, capacities developed.

    Beyond the realm of social psychology lie more obvious markers of social pressure—brute, external restrictions on freedom maintained by intolerance or cultural inertia. Libertarians will agree that laws requiring racial segregation and prohibiting victimless, though controversial, sexual practices are contrary to their creed. But if the constraints on freedom of association suddenly become social rather than bureaucratic—if the neighborhood decides it does not want black residents, or the extended family decides it cannot tolerate gay sons—we do not experience a net expansion of freedom. If a black man who cannot hold employment by law is unfree, so too is a black man who cannot hold employment because social custom decrees that no one will hire him. If a gay couple that cannot legally marry is being wronged, so too is a couple that must stay closeted to avoid social ostracism. A woman who has to choose between purdah and exile from her village is not living a free life, even if no one has bothered to codify the rules in an Important Book and call them “laws.”

    http://reason.com/archives/2009/10/20/are-property-rights-enough

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