April 5, 2011

Demonize and Delete the Austrians (IV): Value-Laden and Value-Free

In the chapter in which he is supposed to be introducing Austrians, Mr. Ferrara prefers to begin mounting a positive case (supposedly reserved for the book's third part). This has  forced us to foreshadow our response.  
And so as we turn the first page of that chapter, we find him asserting that the Catholic Church has always insisted that 
the marketplace, no less than any other field of human action, is entirely subject to the requirements of the moral law, including the dictates of natural justice in both the distribution of goods (distributive justice) and transactions between individuals (commutative justice). (8)  
(We ought to be able to deduce from this categorical [“always”] proposition that the Church subjected the market for human chattel slaves to those requirements.  Unfortunately she took that market as part of the “natural order” in the Aristotelian sense and subjected that peculiar institution to those requirements only on the edges, as it were, until the second half of the nineteenth century. That is, well after the Congregationalists, Baptists and others [whom Her Supreme Heads regarded as heretics] had helmed an effective abolitionist movement.  We will have more opportunities to explore this dimension of Catholic Social Teaching, but let us not follow Mr. Ferrara by getting ahead of ourselves.)
Mr. Ferrara does not specify the sense in which a “field of human action” be “subject to the requirements of the moral law.” The “field” that is the marketplace is ontologically nothing over and above the “transactions between individuals” who alone are subject to the moral law.  The market is a complex process consisting exhaustively of innumerable free offers and free responses thereto, opportunities for profit and discoveries or thereof or their oversight.  (I am pleased to borrow the language of Israel Kirzner, a strict observance Orthodox Jew, and another authoritative Austrian economist to whom Mr. Ferrara never introduces us.)
Those offers and responses are in the hands of the offering and responding individuals.  He who would take them out of their hands bears the burden of argument.  (The contrary assumption—no one may act unless another gives him permission—would lead us quickly to extinction, for permission-giving is itself an action.)
Individuals may arrogate to themselves the prerogative of making decisions for others (and give themselves fancy titles), but after individual transactions are concluded, nothing remains to be “distributed.”  All the actions that carry out individual (decentralized) decisions allocate the total product without remainder. 
In a typical, stylistically flabby sentence, Mr. Ferrara tries to make out a charge against the Austrian School (or at least create an impression that a charge is lurking):
For Austrians, as we shall see, within the market “framework” freedom of action is the ultimate moral criterion and only outright violence, theft or fraud should be prohibited, even if “personal morality” might call for a higher standard of behavior outside the “framework.”  (8.  Commas added to improve syntactical clarity. A.F.)
Mr. Ferrara does not source this scare quote-peppered generalization.  (The market is not a framework? There’s no such thing as personal morality? He sneers, but he does not explain.)
Now, the “prohibition” of certain behavior usually refers to governmental prohibition, and I have little doubt that that is what Mr. Ferrara means.  Since such prohibition is not cost-free, however, Austrians as economists will demand that those attendant costs be addressed and counted (Luke 14:18). 
As libertarian political thinkers, Austrians have a moral objection to authorizing an intrinsically force-initiating institution to prohibit certain immoral behavior (whether or not that behavior involves the initiation of force); or to force individuals to incur costs they do not wish to incur. Austro-libertarians do not acquiesce in the view that the government is exempt from the presumption against the initiation of force. Rather, we hold that the burden of proof is on those who would make that presumption.  We also happen to think that bar for overturning that presumption is quite high, in fact, impossibly so.
If Austrian-libertarians happen to be Catholic Christians, the content of their moral objection is the liberating message of the Gospel.  They are therefore especially averse to sanctioning patterns of interpersonal interaction that violate the dignity of persons, all created in the image of God, to do evil that good may come (Romans 3:5-8). They argue that the State is such a pattern, no matter how many holy personages have been associated with it, and no matter how fine their raiments, glorious their music, their art, and their dwellings.
Vague reference to an emerging attitude now follows:
Theirs is the attitude which first emerged as an explicit ethic in late 16th century Protestant England: “trade is one thing and religion is another . . . . business affairs should be left to be settled by businessmen, unhampered by the intrusions of an antiquated morality or by misconceived arguments of public policy.” (8)
No scare-quotes this time.  Real quotation marks.  In the main text Mr. Ferrara does not reveal the identity of the authority he's citing.  Is it an Austrian?  A 16th century English Protestant? 
No, he’s citing with approval the characterization of an attitude provided by economic historian and social reformer R. H. Tawney (1880-1962), the most influential Christian socialist of his time.  How fitting.  And exemplary of Mr. Ferrara’s propapandistic use of sources.  We wish to stress that Mr. Ferrara is no socialist.  He’s very sensitive to that smear. He just likes quoting socialists and left libertarians and Protestants who have no authority but say things he agrees with. Why?  I have no idea.
The claim about economics around which its practitioners may honestly disagree is over its definition.  The Austrians proffer a formal object free of the admixture of ethical or other value judgments: it is the science of human action, with specific reference to the allocation of scarce resources to achieve imagined ends.  
Now, instead of weighing the pros and cons of this criterion of demarcation, Mr. Ferrara wastes his and his reader’s time by noting (often with the triumphal air of a “Gotcha!” reporter) that a certain Austrian economist has in a certain instance also made a value judgment. 
That the allegedly offending (or self-contradictory, or “forgetful”) Austrian economist was not making ethical evaluations as part of an economic analysis, as he or she understands economics, is obscured. The value-freedom of economic analysis is not in conflict with the value-laden reason why that discipline exists!  On the contrary, in the interest of promoting certain values, we must prescind from them in order to discover and understand causal relationships.  But both interests, cognitive and ethical, motivate the self-same person.
TCATL will afford us many opportunities to drive this point home.