A Critique of Hayek’s Position on Individual Responsibility and the Welfare State
Few have argued more strongly than Friedrich Hayek for the importance of individual responsibility. As he wrote in his seminal text The Constitution of Liberty: “a free society will not function or maintain itself unless its members regard it as right that each individual occupy the position that results from his action and accept it as due to his own action”. Collectivism and the welfare state are said to undermine individual responsibility and self-reliance and are therefore morally undesirable. There is much that can be discussed about these claims, but in this article, I want to focus on what I see as the tension between Hayek’s account of responsibility and of altruism. The consequences of this tension will then be fleshed out.
Hayek argues that since we cannot know whether a person made the best use of their circumstances, we should presume individuals are responsible for their actions and should therefore bear the consequences of those actions. This does not necessarily imply a world of cutthroat competition where the winner takes all, as Hayek believes that humans are fundamentally altruistic and will often seek to further the welfare of others. He only asserts that they must not be coerced into doing this. Hayek writes that: “it is one of the fundamental rights and duties of a free man to decide what and whose needs appear to him most important”.
But if destitute individuals — who may be poor through no fault of their own — are left at the mercy of the charitable wealthy, what criteria should the wealthy use for assessing whose needs are greatest? Should they, for example, provide aid for individuals who have made the best use of their circumstances? And how could they determine this, given Hayek also says we cannot know whether a person made the best use of their circumstances?
Whatever criteria wealthy individuals use when they choose to engage in charity will involve a value judgement about the nature of need or deservingness. To make this value judgement may mean getting to know a particular individual and their particular circumstances, which then leads to a relationship with them. In this relationship, the destitute individual now has an obligation to the wealthy person — an obligation the wealthy person may or may not enforce.
The question now is whether this relationship promotes individual liberty and responsibility. I would argue that it does not for the destitute, dependent individual. In such a society, the wealthy are responsible for the poor, and the poor lack liberty but at least (in theory) receive the sustenance to survive. I would thus argue that Hayek ultimately ignores that even in a society where ‘general altruism’ (e.g. state welfare) is abolished, there is the potential that human need will create interdependent relationships of patronage and corresponding subservience.
These relationships may even become intergenerational, as material privilege (or destitution) is often established at birth. In the absence of state redistribution, inherited privilege would therefore become entrenched. Inherited wealth severs the link between responsibility and liberty; if an individual is through privilege alone extraordinarily wealthy, are they not more likely to be insulated from the consequences of their actions? Inherited wealth undermines not just the notion of personal responsibility, but also impinges on the autonomy of institutions, as the wealthy use patronage to further the fortunes of their offspring.
A classic example of this is the college admissions scandal in the United States, where a number of wealthy parents were revealed to be bribing officials to get their children into prestigious universities. More broadly, the ‘generous’ philanthropy of America’s wealthy to colleges has unsurprisingly coincided with a large concentration of privileged students in the most elite universities. The Equality of Opportunity Project found in a 2017 study that the 38 most selective colleges in America have more students from the top 1 percent of the income scale attending than from the bottom 60 percent.
This society of patronage and hierarchy is the only real historical alternative to state welfare (to date). Hayek’s vision of totally free and responsible individuals acting as rationally as possible in the absence of ‘general altruism’ (state welfare) has yet to be realised anywhere. Nor is it likely to, I would argue, because total reliance on voluntary charity would lead us to regress back towards a hierarchical society in which the poor are reliant on the patronage of the wealthy — whose privilege insulates them from the consequences of their actions.
There is an alternative. We must recognise that to avoid human relationships based on inequality and patronage, the provision of human needs must be done on an impersonal basis; in other words, by the state through unconditional, universal welfare. This the classic rationale for welfare that I believe is often forgotten in our political discourse. Why is this?
I think it is partly because it is natural for humans to judge the needs of others. Concurrently, we are prone to judge how deserving individuals are of having these needs met. Hence why there is so much visceral reaction to media stories about ‘dole bludgers’. It is only human to assess whether other people have ‘deserving’ needs — even when we are actually quite ignorant about the true nature of people’s circumstances.
As citizens, we must remember that impersonal state welfare overall remains superior to the patronage networks. In a universalist welfare state each individual is not judged according to how deserving they are of assistance; rather, they are accorded an equal share of goods and services from the state that both strengthens economic equality and security. Individuals are not indebted to other individuals or wider patronage networks.
Does state welfare still undermine individual responsibility? For some individuals yes, but far less so I would argue than social patronage networks. And state welfare of course implies a redistribution of wealth that helps mitigate the effects of the inherited privilege of the wealthy. The takeout from this, is that Hayek’s vision of free, responsible individuals can only be realised when there is equality of opportunity. And the state is indispensable in facilitating this level playing field.
