Hayek on “The Mirage of Social Justice”

Such is the current state of public debate and understanding that anyone who is against or even questions the presumed desirability of what is known as “social justice” is axiomatically equated with being a monster lacking basic human morality and compassion. Friedrich Hayek (1899 – 1992), one may say, was one such monster. He began by trying to make as good a case in support of the ideal of ‘social justice’ as he could but realized that the concept was meaningless. “I have now become convinced, however, that the people who habitually employ the phrase simply do not know themselves what they mean by it and just use it as an assertion that a claim is justified without giving a reason for it.” That’s from his book The Mirage of Social Justice, the second volume of his magnum opus Law, Legislation and Liberty (1973). Here’s an extended quote from it.
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An Open Letter to PM Shri Modi

“Experience teaches us to be most on our guard to protect liberty when the government’s purposes are beneficent. Men born to freedom are naturally alert to repel invasion of their liberty by evil-minded rulers. The greatest dangers to liberty lurk in insidious encroachment by men of zeal, well-meaning but without understanding.”
Justice Louis Brandeis in Olmstead vs United States 1928


May 26th, 2015

Dear Prime Minister Shri Modi:

I write this letter as a long-time supporter. I have had great expectations from you. Considering the importance of the matter I wish to address, this is very short; considering that you will probably not read anything longer than a powerpoint slide given your busy schedule, it is much too long. Therefore although addressed to you, it is meant for the ordinary citizen of India.

The opportunity for transformational change arises rarely. Rarer still are the times when these opportunities are actually seized and the nation transformed. We never get to know about those missed opportunities because history neither records nor evaluates failures positively. The potential for change exists rarely but actualizing that potential is even rarer still. So rarely do transformations occur that when they do happen, they are highlighted in the history of nations centuries after the events, often long after the entire population has been replaced many times.
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Ministry of Power, Coal, and New and Renewable Energy

Government bureaucrats can hardly be accused of being the sharpest knives in the drawer. I have met many of them and have been uniformly underwhelmed by their understanding of the subject that they are charged with governing. Here’s an example. Most of us get by with using the words “power” and “energy” interchangeably in everyday speech. But I have met poorly educated engineers (around 80 percent of Indian engineers) who couldn’t precisely distinguish the two. They are anything but interchangeable. Although I cannot be sure, I am willing to bet that the bureaucrats and politicians in the ministry that deals with energy — one of the most critically important inputs in any economy — don’t know the distinction between energy and power.
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Political Discrimination is Socially Harmful

Justice as Individual Fairness

Any conception of justice is about the relationship between the members of a society living in cooperative arrangements for the benefit of all members. For any society that is presumed to consist of free and equal persons, the necessary conditions for ensuring justice are equal personal and political liberties, and equal opportunities. Equality before the law is fair. That is, justice is about fairness, as the great political theorist John Rawls argued. He conceives of society “as a fair system of cooperation over time, from one generation to the next.”
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Markets & Competition

Both personally and professionally I love markets. As an economist, I marvel at what the market can do. As a consumer, I am grateful for what it brings to life. It is one of the most significant inventions of humanity. Although it is an old idea, it makes the modern world possible. It is the great coordinating mechanism that creates order without orders, or “spontaneous order.” Markets enable cooperation between strangers, each of whom is motivated by self-interest (which is not the same as selfish interest) but is a necessary part of an emergent order that, in the words of Adam Ferguson, “is the result of human action, but not the execution of any human design.” Markets enable cooperation as mentioned before but their power is a consequence of competition among market participants. Let me tell you a few simple stories.
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Universal Literacy

It stands to reason that compared to the poor, rich people educate their children more. That’s because they have more wealth and can spend more on education. Rich countries therefore have a more educated population compared to the poor, which naturally implies that their populations are more literate. But since at some time in the past every currently rich and literate country was poor and illiterate, it’s interesting to ask which came first — the literacy or the wealth.
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