| | A very thought-provoking article, Ed. I'm in the middle of an interview on Hayek's contributions and I've been revisiting themes from my own book, Marx, Hayek, and Utopia, so my mind has been wrapped around this material for a couple of weeks now.
While I certainly agree that Hayek has real, even profound, problems, and I've criticized him especially in the area of ethics, I do believe that there are certain aspects of Hayek's non-economic writings that can be profitably mined for insightful gems. And, needless to say, his economic writings, especially on the trade cycle, economic calculation, the epistemic role of the price system, etc., are classic, and deserve their privileged place in the pantheon of Austrian theory.
One thing that Hayek stressed, as you mention, was the "tacit" dimension of knowledge. This had profound implications for the socialist calculation debate precisely because "central planners" almost always equated "knowledge" with explicit bits of information. Hence, for the planners, it was always a matter of bringing together all these bits of information and filtering them through a super-computer, as if the computer could make "decisions" based on the collected bits. But these bits were disconnected from the real contexts of individuals, who have their own interests and who are situated concretely in the circumstances of a particular time and place. Knowledge is, indeed, decentralized, individual, personal, situational, and essentially dispersed. And because it consists of both explicit and implicit aspects, it cannot simply be disconnected from the individual decision-maker's context and "collected" for the purposes of system-wide decision-making made by a central planner. More importantly, Hayek suggests that entrepreneurial "creativity" itself is something that cannot be easily "quantified"---it is a combination of explicit and implicit knowledge, hunches, innovation, discovery, risk, the peculiarly individual capacity to grasp specific relationships within a given context, etc. None of this is captured by a quantitative, explicit, articulated approach, upon which central planners rely.
Another thing to stress here---as you mention correctly in the essay---is that Hayek himself was critical of a very specific kind of "reason," what he called a "constructivist rationalist" version of reason, rather than a "critical" reason. This was a limitless, boundless, undefined reason---that is, a reason with no identity, one that implied a kind of omniscience based on the assumption that it was possible to achieve a "synoptic" view of all reality. A reason that can do everything is actually a faculty that can do nothing. Hayek was right to reject that rationalist view of reason; he was right to view it as based on a "synoptic delusion," as he put it. And it is precisely that type of rationalist approach that, he maintained correctly, was bound up with the notion of central planning. Central planning is, indeed, rationalism writ large, rationalism with a vengeance. In a sense, those writers who have viewed socialism as a vestige of the Enlightenment are correct: what the socialists inherited was the hyper-rationalism of the Enlightenment.
Whatever Hayek's faults---and they are many---his anti-rationalist turn shares much with Ayn Rand's own anti-rationalism. My point is not that we need to embrace Hayek in toto, but that his argument in favor of "reason properly used" can be put upon a more objective foundation and appreciated for its contribution to a nonrationalistic---and therefore correct---view of reason.
His understanding of the "unintended consequences" of human action is something that is equally important to our understanding of what reason actually is, which can help us to understand further its real potential. The potential emerges from the actual; if we start with an unrealistic, "hubristic" view of reason, our whole projection of what is possible slams up against the hard realities.
Some writers are just shattered over the prospect of "unintended consequences" because they think that this is an attack on the "efficacy" of human reason and a celebration of "uncertainty." But it is neither.
I have always liked a quote from Barbara Branden (I cite it in my book Total Freedom) on this specific point, and it's worth recalling here. Barbara states that "the inability to live with uncertainty ... is the root of dogmatism, true belief, fanaticism, etc. My personal definition of maturity is precisely the ability to live with uncertainty ... perhaps even to welcome it as a challenge." I stress here a point made with equal intensity by Nathaniel Branden in his essay on "Alienation" (in Capitalism: The Unknown Ideal): The notion that the world can be made completely predictable, that every action must bring about a known effect, with no "externalities," no "side-effects," no "unintended consequences," is nothing less than a flight from psychological maturity.
Insofar as Hayek offers us insights into the rationalist pitfalls of such an approach, I think we can and should use those insights, simply placing them on an even surer philosophical foundation.
Anyway, sorry to go on at length, but it's a good piece.
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