Abstract
This paper takes a closer look at how the relation between liberalism and democracy has been addressed by different strands of the liberal tradition. Its purpose is to argue in support of two claims. Firstly, the claim that discourse on what the two ideals are about, and how they are related to one another, has been impaired by a failure to pay due attention to the distinction between the question of legitimacy and the question of institutional expediency. Secondly, the claim that, when the noted distinction is taken into account, the two ideals can be shown to complement each other in their outlook at how social and political life should be organized.
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Notes
F.A. Hayek ([1966] 1967, p. 161) “Liberalism and democracy, although compatible, are not the same. The first is concerned with the extent of government, the second with who holds this power. The difference is best seen if we consider their opposites: the opposite of liberalism is totalitarianism, while the opposite of democracy is authoritarianism.”
Buchanan ([1985] 2001, p. 271) speaks of the “presupposition that individuals are the only sources of value”.
Such normative individualism is fundamentally opposed to any kind of external normative criterion that is claimed to allow for judgments on social matters independently of how the individuals involved themselves evaluate them, be it “the power of the nation”, “the will of god”, “historical destiny” or any other criterion that allows the holders of power to override the wishes of those they govern on account of their privileged insight into what the supposed standard requires.
Buchanan ([1986] 1999, p. 467f.): “Normatively, the task of the political economist is to assist individuals, as citizens who ultimately control their own social order, in their continuing search for those rules of the political game that will serve their purposes, whatever these might be”.
Buchanan (1975, p. 24): “Under regimes whose individual rights to do things are well defined and recognized, the free market offers maximal scope … for individual freedom in its most elementary meaning.”
Buchanan ([1990] 1999, p. 392): “(T)he whole of the constitutional economic research program rests squarely on a democratic foundation.”.
Hayek ([1973b] 1978, p. 109): “(T)he limitation of all coercion to the enforcement of general rules of just conduct was the fundamental principle of classical liberalism, or, I would almost say, its definition of liberty.”
Hayek (1960, p. 158): “What exactly is to be included in that bundle of rights that we call ‚property ‘ … what contracts the state is to enforce, are all issues in which only experience will show what is the most expedient arrangement.”
The ordo-liberal outlook at the state is covered more extensively in Köhler’s and Nientiedt’s contribution to this special issue.
Such a government, Böhm ([1966] 1989, p. 66) notes, “is constantly faced with a considerable temptation to meet the contradictory demands of many pressure groups.… [T]his tendency … is a weakness of the system which must be taken seriously”.
As Buchanan and Tullock (1962, p. 63ff.) detail in their “Generalized economic theory of constitutions”, the relative weight individuals will assign to “external costs” versus “decision-making costs” in choosing among alternative rules depends on the issue at stake. They will prefer more restrictive decision-making rules (qualified majority) for decisions on issues with potentially significant external costs, while they may be ready to accept simple majority rule for others. As Buchanan and Tullock (ibid., p. 72) note: “The rational individual at the stage of constitutional choice, confronts a calculus not unlike that which he must face in making his everyday choices. By agreeing to more inclusive rules, he is accepting the additional burden of decision-making in exchange for additional protection against adverse decisions. In moving in the opposing direction toward a less inclusive decision-making rule, the individual is trading some of his protection against external costs for a lowered cost of decision-making”.
In line with Rawls ‘s characterization of democratic society as a “cooperative venture”, one may speak, as I have suggested (Vanberg 2005, p. 41ff.), of democratic policies as citizens’ co-operatives or, in German as Bürgergenossenschaften. On the use of the term ‘Genossenschaft’ or ‘co-operative’ as labels for a democratic community, Vincent Ostrom (1991, p. 10) notes, “German-speaking Swiss still refer to the confederation as Eidgenossenschaft. Genossenschaft means association or comradeship. Eid refers to oath. An Eidgenossenschaft is an association bound together in a special commitment expressed by reciprocal oath. A Swiss citizen is referred as an Eidgenosse, that is, a covenantor – a comrade bound by oath. The source of authority resides, then, in a covenant that each is bound to uphold in governing relationships with another”.
Hayek points out, though, that a difference in emphasis exists between the British and the continental liberal traditions: “Most of liberalism’s adherents would also profess a belief in individual freedom of action and in some sort of equality of all men, but … [w]hile to the older British tradition the freedom of the individual in the sense of a protection by law against all arbitrary coercion was the chief value, in the Continental tradition the demand for the self-determination of each group concerning its form of government occupied the highest place. This led to an early association and almost identification of the Continental movement with the movement of democracy, which is concerned with a different problem from that which was the chief concern of the liberal tradition of the British type” (Hayek [1973a] 1978, p. 120).
Hayek ([1946] 1948, p. 29) adds: “Yet, while individualism affirms that all government should be democratic, it has no superstitious belief in the omnicompetence of majority decisions.” – On the source of the tension between the two ideals Hayek (fn. 21) refers to, Bellamy (1994, p. 419) comments that “The relationship between liberalism and democracy is notoriously paradoxical. On the one hand, the justification for democratic procedures most commonly rests on liberal assumptions.… On the other hand, liberal institutional arrangements … have frequently been interpreted as constraints on democracy”.
Hayek (1960, p. 103) writes that “Equality before the law leads to the demand that all men should also have the same share in making the law. This is the point where traditional liberalism and the democratic movement meet.” Mises (1949, p. 271) refers to the common normative foundation of the ideals of liberalism and democracy when he notes that a “democratic constitution is a scheme to assign to citizens in the conduct of government the same supremacy the market gives them in their capacity as consumers,” and when he states that “Democracy is self-government, it is autonomy … Political democracy necessarily follows from liberalism” (Mises [1932] 1981, pp. 63, 65). See also Plattner (1998, p. 174): “Liberalism did not originally insist on democracy as a form of government, but it unequivocally insisted upon the ultimate sovereignty of the people”.
“This means that the power of the majority is limited by those commonly held principles and there is no legitimate power beyond them … [T]he power of the majority ultimately derives from, and is limited by, the principles which the minority also accepts” (Hayek 1960, p. 107).
“Thus, though the consistent application of liberal principles leads to democracy, democracy will preserve liberalism only, if, and so long as, the majority refrains from using its powers to confer on its supporters’ privileges which cannot be similarly offered to all citizens” (Hayek [1973a] 1978, p. 143).
Hayek (1960: p. 103f.): “Its [liberalism’s] aim, indeed, is to persuade the majority to observe certain principles. It accepts majority rule as a method of deciding, but not as an authority for what the decision ought to be.” And furthermore, “Majority decisions tell us what people want at the moment, but not what it would be in their interest to want if they were better informed… True, there is the convention that the view of the majority should prevail so far as collective action is concerned, but this does not in the least mean that one should not make every effort to alter it. One may have profound respect for that convention and yet very little for the wisdom of the majority” (ibid., p. 109).
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Vanberg, V.J. Liberalism and democracy: legitimacy and institutional expediency. Public Choice 195, 251–268 (2023). https://doi.org/10.1007/s11127-021-00873-2
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DOI: https://doi.org/10.1007/s11127-021-00873-2