How many organisations give platforms to their critics? That’s what the CIS did when Kevin Rudd delivered this speech (pdf) last Thursday. Much of it is a critique of Friedrich Hayek. But the part that caught my eye was a common criticism of markets, that its self-interested values invade other spheres where other values ought to prevail. Rudd is unconvinced by what he regards Hayek’s ‘ex cathedra pronouncements’ that the family and the market can be maintained as separate moral realms, as different ‘orders’, a ‘private’ order for the family and ‘extended’ order for market where altruistic values are less applicable. Rudd says:
…this is formalistic nonsense given that Hayek’s fundamental concern is individual liberty and the same individuals are who are participants in family life are active in the market. Is it seriously contended that behaviours in one sphere do not affect behaviours in the other?
In a quote from David McKnight, he elaborates on the problem:
We must be ruthlessly self-interested in the market and sweetly caring in the family, greedy at work, selfless at home.
I don’t think Rudd realises the difficulties this critique creates for his own position. After all, he does not oppose the market. He maintains that ‘social democrats maintain a robust support for the market economy’, just not of the neo-liberal minimal state variety. Yet this would surely mean that everyone would still have their principal exposure to the self-interested values of the market, ie as consumers. Don’t we all like to get a bargain? How often do we really consider the full implications of our purchases for other people or the environment?
When Clive Hamilton makes the sphere-crossing argument it does not contradict his overall position. He does not believe in material advancement or consumer choice, so if Hamilton had his way we would have few contexts in which to learn ‘market values’. But for Rudd, if the sphere crossing argument is right it is nearly as damaging to his argument as it is for Hayek’s.
Fortunately for Rudd’s social-democratic market economy, though not for his attack on Hayek, the sphere-crossing critique of markets is not strong. As I argued in my review (pdf) of Hamilton’s book Affluenza, it’s hard to find evidence consistent with it in stated attitudes. Materialism in the sense of emphasising material goals in life is more common in poor countries than rich countries, and in rich countries it is more frequently found among the poor than the rich.
If anything, the boundaries between spheres are more clearly drawn than at earlier times in history. Economic growth means that for most people in the West their lives are no longer consumed with sheer physical survival. In other words, wealth lifts the pervasive pressure of acquiring material goods, leaving space for other things. It is possible to put self-interest in the realm where it belongs, without it invading other spheres. This is evident in the family, where the last few centuries have seen romantic love narrowed – in the West, again – to virtually the only justification for marriage. Once, family was as much a matter of economic necessity as a matter of love.
It can also be seen in politics, where both self-interest from the economic sphere and personal affection from the family sphere have been marginalised. In the African countries where the spheres do not have strong cultural dividing lines, rulers plunder the country for their own gain and appoint their relatives to political positions.
In the West, where the dividing lines between realms are now largely internalised, few of us have any difficulty being ‘ruthlessly self-interested in the market and sweetly caring in the family’. I’m sure even Kevin Rudd, who must spend more than half the year away from his family in the political sphere, doesn’t think the same values apply to his kids that apply to the political contest.