The technocratic Conception of Politics: Milton Friedman, Stigler, and Rawls

Many countries around the world are today experiencing socially destructive inflation, abnormally high unemployment, misuse of economic resources, and, in some cases, the suppression of human freedom not because evil men deliberately sought to achieve these results, nor because of differences in values among their citizens, but because of erroneous judgments about the consequences of government measures: errors that at least in principle are capable of being corrected by the progress of positive economic science. (Milton Friedman, Nobel Lecture, [1976] 1992, p. 268).

[the] preferable interpretation: that tastes neither change capriciously nor differ importantly between people. On this interpretation one does not argue over tastes for the same reason that one does not argue over the Rocky Mountains--both are there, will be there next year, too, and are the same to all men….that one may usefully treat tastes as stable over time and similar among people is the central task of this essay. ” (Stigler & Becker, "De Gustibus Non Est Disputandum," AER (1977), 77) 

Friedman's Nobel lecture was given in a highly charged, political context resulting from his visit to General Pinochet in Chile a few years before, and shortly after Friedman's most important critic -- the chilean economist Orlando Letelier -- had been assassinated by the Chilean secret police. Even so, it is notable that in the sentence quoted above, Friedman entirely denies the significance of value disagreement in explaining political conflict. That is, in the Nobel lecture Friedman embraces a technocratic conception of politics, which is characterized by the ideal that with knowledge and its progress, political disagreement can be eliminated. 

Friedman's Nobel lecture does not explain the role of the technocratic conception of politics in ordinary (bread and butter) economic inquiry. To the best of my knowledge Friedman never does so (although I have argued that the Nobel lecture resonates with his other methodological writings). To understand that, one must turn to Stigler and Becker's famous essay (1977) "De Gustibus Non Est Disputandum," which is very clear on how "one searches, often long and frustratingly, for the subtle forms that prices and incomes take in explaining differences among men and periods." One does so "by a generalized calculus of utility-maximizing behavior." So, in the mid 1970s 'Chicago economics' officially adopted a technocratic conception of politics. To the best of my knowledge their (Keynesian) rivals at MIT, the Cowles Commission, and Cambridge never did so explicitly, although one might well argue that 'Chicago' was merely catching up with their practice.

Now, there is no intrinsic connection between the (methodological) deployment of a calculus of utility-maximization and the technocratic conception of politics. In fact, when the late Victorian utilitarians, Marshall and Sidgwick, created economics as a self-standing scientific discipline, they did wish to eliminate conflict within science: "my primary aim, then, has been to eliminate unnecessary controversy." (Sidgwick (1887) The Principles of Political Economy, 7.) But they were very careful to deny what I am calling the technocratic ideal of politics:

So far as the purely scientific economist studies primarily the results that tend to be produced by perfectly free competition, it is not because he has any predilection for this order of things—for science knows nothing of such preferences—but merely because its greater simplicity renders it easier to grasp...But the adoption of a perfectly free competition as a  scientific ideal—a means of simplifying the economic facts which actual society presents, for the convenience of general reasoning—does not imply its adoption as a practical ideal, which the statesman or philanthropist ought to aim at realising as completely as possible.” (Sidgwick, The Principles of Political Economy, 23-4)

To simplify a bit, Sidgwick, Marshall, and the Cambridge methodologist of economics, John Neville Keynes (yes the father), all distinguished between positive and normative economics. Milton Friedman cites their distinction approvingly (with a quote and reference to J.N. Keynes) at the start of his famous 1953 methodological essay. Positive economics is the science of what is, normative economics is the science of what ought to be. Typically, consensus was thought attainable over the former but not over the latter. Again, Sidgwick provides useful evidence: "there is no generally accepted axiom of ethics or politics which can be taken as a principle for judging of the righness or goodness of different modes of division." (26) A generation later, Robbins, agreed (recall this post).

Now, from the point of view of the science of political economy, one can kind of understand why policy oriented economists, so-called applied welfare economists, who in the search of a "professional consensus," would slide into embracing the technocratic ideal of politics (recall my post on the Godfather of the Chilean "Chicago Boys," Harberger). This allows them to speak in one voice, and become the privileged policy-experts. Moreover, they can produce lots of results.

But the technocratic conception of politics is not just an ideal of opportunistic economists; it's an ideal promoted by the most important political philosopher of the period, John Rawls:

By way of summing up, the essential point is that despite the individualistic features of justice as fairness, the two principles of justice are not contingent upon existing desires or present social conditions. Thus we are able to derive a conception of a just basic structure, and an ideal of the person compatible with it, that can serve as a standard for appraising institutions and for guiding the overall direction of social change. In order to find an Archimedean point it is not necessary to appeal to a priori or perfectionist principles. By assuming certain general desires, such as the desire for primary social goods, and by taking as a basis the agreements that would be made in a suitably defined initial situation, we can achieve requisite independence from existing circumstances. The original position is so characterized that unanimity is possible; the deliberations of any one person are typical of all. Moreover, the same will hold for the considered judgments of the citizens of a well-ordered society effectively regulated by the principles of justice. Everyone has a similar sense of justice and in this respect a well-ordered society is homogeneous. Political argument appeals to this moral consensus. (A Theory of Justice, 263); emphases added

Rawls is here appealing to what we might call a representative moral agent not unlike the representative agent in economics. (I have argued that in context Rawls makes clear he is aware of the relevant discussion among the economists.) Without wishing to minimize the many substantial differences between Rawls (of the early 70s) and Chicago economics, they share commitment to the technocratic ideal of politics.

One need not be a follower of Nietzsche or Carl Schmitt in order to recognize that the embrace of the technocratic ideal of politics is dangerous in the hands of experts that believe it true and believe that one, therefore, can ignore non-expert opinion when setting policy. Acknowledging such danger, does not entail that one has to embrace distrust of scientific experts or become a fellow-traveler with Creationists and anti-Vaccine activists. Rather, all it means that if one ignores disagreement about ends, "it is a case of thy blood or mine—or live and let live, according to the importance of the difference, or the relative strength of our opponents." (Robbins, An Essay on the Nature and Significance of Economic Science, 151 [2nd ed; 1945 (1932)]) That is, a price will be paid.

 

Comments

[Marianne Johnson]

Perhaps this is at the root of Buchanan's antipathy to "new" Chicago economics as opposed to that practiced by Knight and Simons?

[Eric Schliesser]

I think that is right, Marianne. Although I should say that some of the Chicago roots on the need for value unanimity are to be found in Knight. So, the story is also complicated.

[Lisa]

Isn't there a difference in that Rawls says this about the basic structure (and then has this four-stage-scheme for arriving at real political questions), whereas for Friedman and co. it is also about concrete day-to-day politics? Not sure which one is better or worse, but they seem different.
By the way, it's striking that if you read the first quote by Friedman it makes you think about Greece etc. today - but it has been exactly Friedmanian politics that brought about the suffering...

[Eric Schliesser]

Yes, there are non-trivial differences within the technocratic political ideal, and you have hit one of the crucial differences.
I don't think it is right to say "exactly Friedmanian politics." He would have surely have been skeptical about Greece's joining the EURO. As he wrote: "Europe’s common market exemplifies a situation that is unfavorable to a common currency."