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The Big Smothering State

1 Aug 2012 By Edward Hadas

For more than three centuries, defenders of people’s freedom and dignity against the oppression of governments have frequently focused on economic depredations. In the 17th century, John Locke decried unjust limits on private property. In the 20th century, Friedrich Hayek attacked the state’s control of the means of production. The Austrian philosopher, who is a kind of patron saint for today’s crusaders against big government, was certain that men could not be free without free markets. He saw socialist economics behind all big governments, which he believed to be universally oppressive.

It is not only the enemies of powerful governments who have considered economic matters to be pre-eminent. The followers of Karl Marx disagreed totally with Hayek about government and freedom. They thought free markets led only to the oppression of the poor by the rich and that large states were needed to defend true freedom. However, like Hayek, they put the economy at the centre of the debate about the proper role of government. They merely reversed his primary prescription, with pure Marxists calling for total government control of the economy and revisionists calling for a strong state and a carefully limited private sector.

The revisionist Marxists are now known in Europe as Social Democrats and in the United States as Democrats (although few would admit this intellectual ancestry). They have had their way with the economy throughout the developed world – and the economies have basically flourished. Extensive, active and basically honest governments are good economic stewards. Big governments support and supervise the massive investment projects, complex technological standards and the astounding diversity of tasks required for industrial economies to thrive. Thorough tax systems restrain the rich while welfare benefits protect the poor.

Still, economic success is not enough to justify the ambitious and intrusive contemporary approach to government. The Big State should be judged by a more complex standard than simple material prosperity.

Hayek feared the terrible regimes of the Stalinist Soviet Union and Nazi Germany. Modern governments are nothing like those Big Oppressive States. Still, they can fairly be called Big Smothering States. There are three ways in which the government makes society less free, and in all of them the economy is the exception.

First, contemporary governments deal primarily with individuals; they generally ignore, restrict or repress what sociologists call civil society – families, churches, schools, unions and other sorts of voluntary organisations. The state increasingly guides and restricts the actions of these once largely autonomous groups. As the freedom and authority of intermediate organisations is reduced, the power and authority of the state is increased. It becomes harder to find activities which are not closely supervised by the government.

In contrast, civil society is thriving in the economy, in the form of corporations. These enterprises can develop their own cultures and communities with relatively little interference from the government. Some employees may find the cultures inane or even inhumane, but at least the state mostly leaves them alone.

Second, the Big State relies on smothering bureaucracies. Over the last three generations governments’ rule-books and administrative staffs have expanded massively. The result is that the freedom and creativity needed to educate, care, punish and help are restricted by overly rigid rules and regulations. Moral concerns are often ignored.

In the economy, though, bureaucracy is basically beneficial. Only rule-bound hierarchical organisations could organise the thousands of strangers well enough to provide the many goods of industrial prosperity. Government and corporate bureaucracies form an almost seamless web.

Third, modern governments pursue a controversial social agenda. Locke’s vision of governments which leave as much of life as possible to the governed, has disappeared. Modern states have precise goals for school curricula, health care, art, sport and sexual roles. In most domains, the state’s vision is shared by the majority of the population, but that still leaves a deeply opposed minority smothered by the state’s demands for conformity.

Once again, it is quite different in the economy. There the basic goals of the Big State – increased prosperity and ample opportunities for work – are much less controversial. I would argue for some modifications, for example less much emphasis on GDP growth and more on labour and the environment. In comparison to the debates on social policy, though, such complaints are little more than quibbles.

The crusade against big government needs a new patron. Hayek’s focus on economics makes the attack look silly, for he is complaining about modern government at its best. It would be better to draw a clear distinction between the generally helpful Big State of the economy and the Big Smothering State of the rest of society. Of course, the two developed together and remain closely entwined. It is worth trying to pry them apart – to let the first flourish and the second wither.


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