Conservative arguments for market socialism

Socialism is typically seen as antithetical to conservatism. But, why should this be? Socialism is a view of property relations in an economy, whilst conservatism is a way of answering the fundamental questions of politics like what does justice require?, what is of value in political decision making?, or what are the ends of our political life? Conservatism is clearly answering questions that are prior to the questions that socialism is answering. As a result, I’ve long thought that it should be possible to make conservative arguments for a particular type of socialism: market socialism.

By market socialism I mean, in broad terms, an economic system that combines socialising ownership of most large productive enterprises or at least of some key industries, and the use of markets to distribute goods and services.¹ The core insight being that central planning is impossible in an effective way and so should be abandoned. Rather, following Hayek’s insight, markets and prices are the most effective way of transmitting knowledge about supply and demand between producers and consumers. This is a more minimal conception of market socialism than that offered by John Roemer or David Miller. Unlike them I leave aside, for now, the particular mechanism by which ownership of enterprises are “socialised”, any “behavioural ethos” or any view of the political structure.² This is because those details will be filled in later to show how a particular form of market socialism is justifiable from conservative values of self-interested pursuits and stable governments over revolutions.

It is important to keep in mind that I leave aside any mention of the welfare system or taxation. This is because these solve problems that are independent of the one market socialism attempts to solve. The welfare state or system is a solution to the problem of how a society deals with the welfare of non-workers or market outcomes we wish to correct. This is a problem that will have to be solved in some way no matter what system of production and ownership we choose. Taxation is a solution to how government expenditure is funded. Again this is a solution that will have to be worked whether we adopt market socialism or not.

Arguing for market socialism from egalitarianism is a well worn path. What is more interesting given our modern societies are riven with deep moral and political disagreement is if a convergent argument could be made for it from conservatism. By conservatism I do not mean the mealy mouthed methodological or dispositional conservatism of valuing the status quo or reforming only slowly with caution.³ As I have argued in an earlier post about methodological progressivism, methodological conservatism is not wedded to any form of substantive political idea. It is logically available to and is practically made use of by all those who find their ideologies are established in society.

Conservatism properly understood is the view that society is ordered justly when it conforms to a natural hierarchy as laid out by God or inherited from one’s ancestors, or some mix of both. This is the substantive view of conservatism we see from Edmund Burke in his Reflections on the Revolution in France. In contrast to the French Revolution, Burke defends the English Glorious Revolution of 1689 on the basis that the King was deposed not for mere misconduct, but for breaching a contract with the people to uphold their inherited laws and liberties. As such, the monarchy was preserved with a different King and Queen, who held power by hereditary right and so were best placed to see the value of the people’s inherited liberties and protect them. For Burke, inheritance from the past binds the British constitution: “We have an inheritable crown; and inheritable peerage; an house of commons and a people inheriting privileges, franchises, and liberties, from a long line of ancestors”.⁴ These inherited rights of the people, the nobility, and the monarch forms the natural hierarchy that conservatism pursues for Burke.

Although Burke doesn’t say much about conservatism in a general sense, I think it is safe to infer that it is fundamentally made up of two ideas. The first idea, its idea of the good, is of a social hierarchy of social and economic power. This will typically involve a regime of rights and obligations that are a blend of Constant’s liberties of the moderns and ancients. That is, a mix of rights that guarantee private property and non-interference from the state, and rights and obligations to take part in the civil society and political process. This regime builds a hierarchy of authority amongst individuals and various groups. For instance, a republican version may be composed of individual liberties to participate in all political roles, special privileges for families, the church, private enterprise and a ruling elite.

The second idea, conservatism’s idea of the right, is that hierarchies are normatively correct to bring about when they are inherited from one’s ancestors from the process of social evolution or they are divinely inspired. This makes them natural hierarchies in the sense they are the result of a process at the core of human nature (ie, inheriting norms from our ancestors), or a realisation of the natural order of things as described by religion. This is in contrast to egalitarianism where the distribution of rights, opportunities and resources of value is one that is equal to some defined extent, and typically right to realise because it is justified to all. Burke emphasises the contrast in relation to the egalitarians of the English Civil War when he says, “Levellers only change and pervert the natural order of things”.⁵ This doesn’t mean that natural hierarchies will stay the same forever. As Burke tells us conservatism allows for the natural hierarchy to renew itself through incremental changes depending on social changes and new historical circumstances. One modern conservative who comes closest to expressing this core idea of conservatism is Roger Scruton with his authority, allegiance and tradition based view. In summarising the second principle of conservatism (the first being that its precise general form), Scurton says:

…conservatism engages with the surface of things, with the motives, reasons, traditions and values of the society from which it draws its life. There are further ideas, abstract in their origin, but specific in their implications: society exists through authority, and the recognition of this authority constitutes a bond that is not contractual but transcendent, in the manner of the family tie.⁶

One further preemptive charge might be that socialism’s roots lie in its reaction to the liberalism of the 18th and 19th century. Moreover, that socialist ideas grew out of liberal ideas of unchaining the oppressed individual. And, given conservatism is directly opposed to liberalism, no reconciliation with socialism is possible. I am not an intellectual historian, so cannot credibly debate the premises of thai charge. Nevertheless I think one shouldn’t confuse historical and genealogical relations with logical or conceptual ones. It doesn’t matter for whether a conservative can logically accept market socialism, if, historically, socialist ideas grew out of a set of ideas antithetical to conservatism. Ideas develop in all sorts of ways without much design. What really matters is whether in the here and now, there are any logically coherent reasons that mean conservatism and market socialism are incompatible.

Given what I have said about the central idea of natural hierarchy to conservatism it might seem that no argument could possibly be made from it for market socialism. A natural hierarchy appears antithetical to the egalitarian ideals market socialism tries to realise. But, this is not necessarily the case for two reasons. Firstly, it is possible for religious conservatives to hold a view of people’s moral worth which is egalitarian to a certain degree. For instance, they might believe all people are equal under God or that most people are equal under a small elite. In both cases, the natural hierarchy may be egalitarian enough to recommend market socialism. Secondly, even if conservatives believed in some highly stratified hierarchy, it could be that the best policy for that hierarchy to maintain social peace was some form of market socialism. It could be a purely empirical matter that given the natural resources available to it and the international market, market socialism may be the best route to prosperity. In short, there is no reason why conservatism must necessarily entail large economic disparities or capitalism.

So if market socialism is at least on the table for conservatives, what justifies it? One easy place to start is the value conservatives place on the freedom of the individual and collective enterprises to pursue self-interested goals. This is part of even a sufficiently egalitarian hierarchy that forms the conservative idea of the good, where a regime of rights that encourages an ethos of competition is required for innovation and efficient distribution of capital, rather than state run monopolies. Market socialism embraces this. It finds that competition amongst state owned enterprises is a key way to keep costs down, allow workers to feel motivated, move employers if they wish, and spur innovation, whilst socialising the profits. A nascent model of this can be gleaned I think from the organisation of Chinese civil infrastructure firms.⁷

Another way conservatism might justify market socialism is that it guarantees the freedom of association for individuals. This is an important aspect of modern conservatism’s view of the rights individuals have in the natural hierarchy. Individuals should have the liberty to freely form groups for their pleasure and to advance their interests without interference from the state. The most relevant example of this is Lech Walesa, the Polish trade unionist who led the Solidarity movement against community rule in Poland. Market socialism does not place any restrictions on this practice. Moreover, market socialism relies on labour unions for the management of industrial relations. This is because market socialism eschews centralised wage setting or a completely solidaristic relationship between unions and the government. Market socialism embraces the inherent tension between workers and enterprises to find an equilibrium for wages and conditions.

Which leads to another conservative argument for market socialism. Realising a natural hierarchy typically involves protecting the right of private enterprise. This is because it is seen as an extension of people’s labour or an inherited arrangement that grows from a family which is the smallest collective unit of the natural hierarchy. In short, valuing private enterprise is to value at least one way the social hierarchy perpetuates itself through inherited family businesses or wealth. Market socialism has no inherent objection to private enterprise. It seeks to spread the benefits of the economy equally by public ownership of key industries like utilities, transportation, telecommunications, certain parts of the financial sector and consumer goods production and distribution.There is no dogma here about large government monopolies for the production of all goods and services. Public ownership aims to maintain a diversity of firms to enable competition and can occur through ownership of publicly traded shares. This allows a great degree of freedom for small private enterprises to operate within the limits of the broader industrial relations system.

One final argument concerns the political process and conservatism’s idea of the right. Conservatism is not enamoured with revolution. Rather, it views the types of deliberative politics and some form of adversarial parliamentary system of government that has evolved in many countries as the right way to bring about changes in the economic structure. Market socialism is entirely compatible with this. It does not require a one party state or quashing of all disagreement in politics. This is in part because it is not a revolutionary form of socialism. It does not require an overthrow of a government or constitution to implement. It embraces financialisation as a peaceful way to nationalise existing industries through the share market or establishing state owned enterprises that can trade at least a minority of their shares openly. This means socialising parts of the economy can be done with existing financial instruments and without revolution. Market socialism embraces the political process, whatever it might be, to share the benefits of the economy in an equal way. This should be justifiable to any conservatism with a sufficiently egalitarian view of the natural hierarchy.

So what do all these arguments actually mean for conservatism or market socialism? Of course answering that seriously requires fleshing out the details of the conservatism we are dealing with. However, I think they show, at the very least, that actual conservatives have some prima facie reasons to consider an actually viable alternative to liberal capitalism without resorting to knee jerk reactions to the dangers of socialism. Market socialism presents a viable economic system they could converge on with egalitarians.