Nietzsche, Hayek and the Marginalists…and Max Weber?

Corey Robin has just published a provocative and interesting essay in The Nation on the connection between the conservative doctrine of Nietzsche, the marginal revolution, and the Austrian school of economics. I won’t summarize the entire piece here – it is well worth taking the time to read – but merely provide some initial impressions.

Basically, Robin traces something of an “elective affinity” between Nietzsche and the 19th century economists who ushered in the marginal revolution. These figures, namely William Stanley Jevons, Carl Menger, and Leon Walras, initiated a movement in political economy that replaced the heretofore dominant labor theory of value (subscribed to by Smith, Ricardo, and Marx) with the theory of marginal utility and subjective value. According to the latter, economic value was not inscribed in an “objective” world of commodities and relations of production, but instead in the subjective value or worth that consumers were willing to place in those objects. In other words, the value of an object depended on the lengths that individuals were willing to go to acquire it (i.e. pay for it), rather than the amount of labor that went into producing it.

Despite their pronounced political differences – Nietzsche is best characterized as an aristocratic conservative, the marginalists as pro-market liberals – Robin claims that Nietzsche’s ideas make him a useful diagnostician for the rise of the idea of subjective value and, eventually, for contemporary neoliberalism (by way of Hayek).  Whereas Nietzsche set the stage by pointing to the limits of metaphysics for grounding the world and giving human life authoritative meaning, and thereby arguing for a transvaluation of the heretofore dominant values of Western civilization, the marginalists, and later “classical liberals” like Mises and Hayek, saw the free market as the only possible arbiter of value in society. Furthermore, both Nietzsche and the marginalists shared a hostility to trade unions and the burgeoning socialist movement of the 19th century, which Robin points to in arguing that implicit in the doctrine of the free market (and particularly in Hayek) is a critique of “mass society” and an aristocratic conception praising the wealthy as the avant-garde of taste and of social value.

Taken separately, Robin’s exegeses on Nietzsche and the marginalists and Hayek are excellent and insightful. But something of a disconnect remains in the link he tries to draw between them. For one, there is little evidence to suggest that Nietzsche was aware of the innovations of Menger, Jevons, or Walras, although we are told that he did critique unnamed contemporary economists for their fixation with the term “value” and, of course, understood enough about political economy to argue that the vitality of classical Athens depended on the sequestering of slave labor away from the public life of the polis. Neither is there an indication that the marginalists read Nietzsche, their contemporary (although I’m guessing Hayek almost certainly did).

Of course, Robin is not arguing that there is a direct line of influence between these thinkers. His claim is rather that Nietzsche’s insights best capture the cultural and social forces at work from which the marginalists would draw their economic conclusions. This may be perfectly true, but there is nevertheless a kind of “x degrees of separation” game being played here, in which the appeal is more to a fin de siecle European cultural Zeitgeist than of a causal connection between Nietzsche, the marginalists, Hayek, and postwar neoliberalism. My hunch is that Robin wants to claim that one can make that connection, but it does not come through here.

The term “elective affinity” of course invokes Weber and his thesis on the connection between the development of capitalism and the Protestant work ethic. Yet perhaps Weber looms here in more than just this way. If the connection between Nietzsche, the marginalists, and Hayek is not quite one of direct influence and yet can provide us with insights about postwar neoliberalism, then why not consider Weber himself, certainly one of the most “Nietzschean” thinkers of the 20th century? Despite being deeply influenced by Nietzsche in his philosophical and meta-theoretical reflections, Weber was far removed from the marginalists and the Austrian school, instead being educated in the German historical tradition of economic thought. To my knowledge, Weber never articulated the kind of anti-statist, anti-interventionist economic policies that have come to be associated with the Austrians today. If the economic legacy of Nietzsche can point in the opposite direction, by way of a thinker who read and knew Nietzsche far better than the ones Robin focuses on, then perhaps the story gets more complicated.

Finally, the idea that an individual’s worth or value depends on how he is held by others originates not with Nietzsche nor the marginalists, but much earlier with Hobbes:

“The Value, or Worth of a man, is as of all other things, his Price; that is to say, so much as would be given for the use of his Power: and therefore is not absolute; but a thing dependant on the need and judgement of another…And as in other things, so in men, not the seller, but the buyer determines the Price. For let a man (as most men do,) rate themselvesat the highest Value they can; yet their true Value is no more than it is esteemed by others.” (Leviathan, Ch. 10)

This should not be surprising, since Hobbes can certainly be thought of as a political theorist of the nascent bourgeois order (I subscribe to this view myself). But this complicates Robin’s narrative that Nietzsche and the marginalists separately developed their theories partially in response to the labor movement of the 19th century, since we see this strand of thought emerging some 200 years earlier. Perhaps Hobbes was a conservative and a reactionary in the same vein as Nietzsche and Hayek, and this recurring emphasis on the subjectivity of value is a symptom of the pathologies of conservative thought rather than having anything to do with the struggle between labor and capital? But this suggestion in turn raises a different question – how correct would we be in applying these labels to Hobbes, whose pro-monarchist views were underpinned by a fundamentally innovative political theory of authority that in the long run did more to undermine the basis for monarchy than preserve it, and who was writing over a century before the French Revolution, when the true distinction between radicalism and reaction emerged?


UPDATE: Also make sure to take a look at Robin’s post and the unfolding debate in the comments section at Crooked Timber.

Stanley Fish on Jurgen Habermas

A new opinion piece by Fish on Habermas and the role of religion in his thought. Fish critiques Habermas’s conception of reason, seeing it as more or less instrumentalizing religion while under the guise of reconciling the two. Of course, critiques of Habermas’s work have been prominent in intellectual circles for more than two decades now, and Fish does point out that his new ‘reconciliation’ with religion still doesn’t fit entirely well with his idea of secular public reason.

I think Habermas is on shaky ground about a different point, however. As paraphrased by Fish, Habermas generalizes that the “motivational weakness” the modern Liberal state creates in its citizens (in other words, an overly individualistic attitude that only cares about self-preservation and self-interest) has led to “the massive injustices nations and tribes inflict on one another.” Therefore, Habermas concludes, something more, something transcendent, is needed that can further justify and ground solidarity among people in today’s world. But can’t the reverse be historically just as true? Can’t we convincingly argue that the modern Liberal state and its corresponding institutions emerged precisely as a response to the injustices perpetuated by collectives (nations and tribes) upon other collectives? Here one can recall Hobbes’s argument in the Leviathan, written during the religious wars of the seventeenth century. It’s no small coincidence that one of the founding texts of the modern Liberal state t0ok an atomistic view of the individual as its starting point right when the European continent was embroiled in a sectarian conflict.