Humbold'ts WEIRD Economic Philosophy- and Ours

    

Michael Bentley suggests that “all the issues raised by Humboldt may come under the aegis of a single question framed in our own modern idiom and it would take this form: does the state have a duty of care to its citizens?” Approaching “The Spheres and Duties of Government," SDG,[1] under the aegis of this question shows Humboldt as outlining basic principles of a political philosophy of WEIRD (Western, Educated, Industrialized, Rich, and Democratic)[2] societies at the critical historical juncture when they took off to dominate the world. 

After making a preliminary distinction between caring for the ‘good’ of citizens and preventing ‘evil’, Humboldt further distinguishes “evil which arises from natural causes” (SDG, 20) from evil “which springs from man’s disregard for his neighbour’s rights” (SDG, 20). Security against the evil arising from a disregard for others’ rights is “the only thing which the individual cannot obtain for himself and by his own unaided efforts” (SDG, 53-54). 

At least among the many, a state is necessary to guarantee its citizens security against the “moral” evil of rights’ violations by fellow citizens. Since “without security, there can be no freedom” (SDG, 53) and without freedom “(t)he true end of Man, …, the highest and most harmonious development of his powers to a complete and consistent whole” (initial line of chap. II, SDG) cannot be successfully pursued, a state is necessary and desirable to further human flourishing. 

For Humboldt it is, however, neither necessary nor desirable to let the state provide for security against natural evil. It is unnecessary since individuals can self-organize remedies for natural evil in their private capacities (e.g. through mutual aid organizations or by private contracting and exchange on insurance and other markets). It is undesirable since having to cope with natural evil ‘nudges’ man on towards the “highest and most harmonious development of his powers to a complete and consistent whole.”

Though Humboldt’s basic line of argument captures the secret of the political success of WEIRD societies with succinct analytical clarity most of their citizens will not agree. They will “weirdly” invoke natural rights to universal protection of all men against moral evil and also demand that individuals be protected against the natural evil of preventable imminent threats to life and limb.[3]

“(R)easons for wishing there were such things as rights, are not rights; -- a reason for wishing that a certain right were established, is not that right -- want is not supply -- hunger is not bread.”[4] Unlike Jeremy Bentham who shortly after the preceding quote classifies rationalist a priori theories of natural rights as “nonsense upon stilts,” Humboldt occasionally uses the term “natural right” approvingly, but he does so only to refer to traits of social institutions one would expect to prevail for a posteriori reasons that come to mind “naturally." 

For instance, Humboldt observes that “our states are in a far more favourable position than we can conceive that of man in a state of nature to be (closely knit together, as they are, by innumerable treaties and bonds of alliance, and by mutual fear …)” (SDG, 53). That is, among a few states or in a small society of a few individuals concrete social institutions may – as we would express it today – “spontaneously” emerge and as a matter of conventional fact bring about what Hume called “the three fundamental laws of nature, that of the stability of possession, of its transference by consent, and of the performance of promises.[5]  

Among the few, rights and law can exist independently of the hidden hand of the state and in that sense “naturally." But for Humboldt only a state can “artificially” create the security that enables large numbers of individuals to interact and contract in the “Company of Strangers”[6] as legal equals'' under some form of rule of law in a Great Society. Humboldt’s detailed discussions of tort law, risk, and the limits to contractual commitment power treat rights as social conventions that co-evolve with the state and state action.[7] Accordingly, the answer to questions concerning the extent of the state’s “duty of care to its citizens” is not simply that the state must enforce natural rights that are known a priori and given independently of specification by the state. It is “WEIRDly” teleological. 

Under the conventional assumption that one who wants an end is “instrumentally obliged” to endorse the necessary means, ends can give rise to contingent duties. In this vein, those who as a matter of fact share Humboldt’s ideals and regard his implicit empirical hypotheses concerning what furthers human flourishing as sufficiently corroborated, can interpret his essay as an explorative study in basic principles of “state mechanism design." Other than conventional economic mechanism design, Humboldt’s allows for non-material ends and pursuits, but quite in line with the skeptical meta-ethics of modern economics, a posteriori rights, obligations and duties can all be justified relative to factually accepted ends. [8]

Nobody needs to “own” Humboldt’s “true end of man,” but it is not merely a far-fetched elitist vision of a Western, Educated, Rich young man writing in the wake of the French Democratic and the English Industrial revolution. Quite to the contrary, what may be called Humboldt’s “quasi-religious cult of individual freedom and responsibility” seems as a matter of fact deeply rooted in the cultural heritage of our WEIRD states. 

The presumption of the liberal “righteous mind”[9] that the principles of WEIRD societies are universal may be illusory. Yet, we can start from where we as a matter of fact are in the co-evolutionary process of “genes, mind and culture”[10] in our WEIRD societies and follow Humboldt’s method in projecting a desirable improvement path of WEIRD states into the future. 

As Michael Bentley perceptively emphasizes, Humboldt saw himself as starting from the most comprehensive conception of the state’s “duty of care to its citizens” and then removed all uses of the monopoly power of the state that could conceivably be fulfilled by citizens in their private capacities. He deemed this reduction desirable in view of what he identified as the true end of man and what is conducive to pursuing it; yet, what if man does not make that “true” end his own end?

Recalling the British Moralists’ fundamental insight that it is “on opinion only that government is founded”[11] it is not at all clear that the Humboldtian “deconstruction” can meaningfully go on until the state takes care only of the “security against the evil arising from a disregard for others’ rights."[12] To go all the way down to the minimal state may be socially infeasible if it erodes the opinion supporting the Hartian “rule of recognition”[13] on which the political sub-order of Humean natural law is ultimately founded.

One should also note that Humboldt’s minimal state is a welfare state of sorts: funded by coercive taxes it provides its protective services in form of fixed “equal rations of care” independently of the citizens’ willingness or ability to pay for them. Therefore, in a Humboldtian framework, getting rid of the welfare state cannot be the aim, only its devolution. But moving towards the minimal state along the continuum of welfare is conceivable. Now, in a minimal state equal legal care for security against the “evil arising from a disregard for others’ rights” is provided inclusively on condition of citizenship only, without discrimination according to willingness and ability to pay for protective services. This is hard to distinguish from inclusive demogrant schemes that treat all citizens of a state in a schematic non-discriminatory way equally as beneficiaries of non-means-tested claims.

Against this background, Milton Friedman’s and James Buchanan’s tentative endorsements of negative income tax demogrant schemes are not occasional ad hoc remarks with which otherwise “sound” members of the Mont Pelerin tried to make a gesture of compassion.[14] They should rather be seen as early explorative steps in a Humboldtian program of minimizing the state’s regulatory role within the constraints of “opinions” concerning legitimacy and repugnance that prevail among citizens of WEIRD societies.[15]

Of course, what is feasible does not only depend on opinions of legitimacy but is also subject to financial and other constraints. Yet, classical liberal political economists who endorse the ideal of a society of free and responsible individuals may be well advised to adopt a comprehensive Humboldtian perspective when it comes to questions of sustaining the Humboldtian ideal of a private law society.[16]

[1] All Humboldt citations in this text refer to Humboldt, Wilhelm v. The Sphere and Duties of Government. (London: Chapman, 1854) in the form “SDG, page no”; https://oll.libertyfund.org/page/humboldt-government. Michael Bentley used the alternative translation “The Limits of State Action” which also appeared in print at Liberty Fund; https://www.libertyfund.org/books/the-limits-of-state-action/.

[2] On WEIRD societies see Joseph Henrich. The Weirdest People in the World: How the West Became Psychologically Peculiar and Particularly Prosperous. (London: MacMillan, 2020). With “Better in the West!” James Buchanan summed up his views on “identity politics." See Arnold Kling's review at Econlib.

[3] State-sponsored variants of the so-called “rule of rescue” are implemented in all WEIRD societies; see e.g. John McKie and Jeff Richardson. “The Rule of Rescue.” Social Science and Medicine 56 (July 1, 2003): 2407–19. https://doi.org/10.1016/S0277-9536(02)00244-7.

[4] Jeremy Bentham. Anarchical Fallacies, vol. 2 of Bowring (ed.), Works, 1843, Article II; Liberty Fund, https://oll.libertyfund.org/title/bowring-the-works-of-jeremy-bentham-vol-2#lf0872-02_head_411

[5] See David Hume. A Treatise of Human Nature. (Oxford: Clarendon, 1896 (Selby Bigge ed.)), bk iii, part ii, sec. vi, first sentence, p. 526, https://oll.libertyfund.org/title/bigge-a-treatise-of-human-nature. Whether or not such “Humean natural law” can conceivably be realized beyond the limits of small anarchical societies by suitable conventions without extending the division of labor to the enforcement of norms through a specialized legal staff backed by the fundamental coercive power of a state is contested. The “Folk theorem” logic of this problem was seminally spelled out in Michael Taylor. Anarchy and Cooperation. (London et al: John Wiley, 1976).

[6] See Paul Seabright. Company of Strangers. (2nd Revised ed. Princeton, N.J: University Press Group Ltd, 2010).

[7] For instance, in chapters IX-XIII of SDG voluntary slavery, marriage without exit options, etc. are discussed often in a strikingly modern law and economics way. Later scholars who, like Nozick, discuss these problems philosophically seem conspicuously unaware of their precursor; see Robert Nozick. Anarchy, State, and Utopia. (New York: Basic Books, 1974).

[8] Relative to the given (ideal) ends SDG is a stylized technological description of a suitable state mechanism. For “technology” as a descriptive theory see Hans Albert. Treatise on Critical Reason. (Princeton: Princeton University Press, 1985).

[9] See Jonathan Haidt. The Righteous Mind: Why Good People Are Divided by Politics and Religion. (London: Penguin, 2013).

[10] Alluding to Charles J. Lumsden and Edward O. Wilson. Genes, Mind, and Culture. The Coevolutionary Process. (Cambridge: Harvard University Press, 1981).

[11] See David Hume. “Of the First Principles of Government,” in Essays, Moral, Political, and Literary. Part I, Essay IV, p. 32 https://oll.libertyfund.org/title/hume-essays-moral-political-literary-lf-ed#lf0059_label_131.

It is insufficiently acknowledged that late in his life Hobbes obviously under the impression of criticisms of his basic homo oeconomicus model already came around to acknowledge that ." the power of the mighty hath no foundation but in the opinion and belief of the people." (Thomas Hobbes. Behemoth, Chicago: University of Chicago Press, 1682/1990, p. 16.).

[12] For instance, without implementing a “rule of rescue” that guarantees state sponsored help in cases of the natural evil of imminent threats to concrete life and limb, WEIRD, rule of law societies will not be deemed legitimate by their citizens.

[13]See Herbert L. A. Hart, The Concept of Law (Oxford: Clarendon Press, 1961).

[14] See on this in more detail Hartmut Kliemt. “On Justifying A Minimum Welfare State.” Constitutional Political Economy 4, no. 2 (1993): 159–72.

[15] Alvin E. Roth. “Repugnance as a Constraint on Markets.” Journal of Economic Perspectives 21, no. 3 (September 2007): 37–58. https://doi.org/10.1257/jep.21.3.37.

[16] See on this Humboldtian „ordo liberal“ ideal which became politically influential in postwar Germany through the Freiburg School of Political Economy, Franz Böhm. “Privatrechtsgesellschaft und Marktwirtschaft.” ORDO 17 (1966): 75–151.