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Social policy - the rule of law as referring to an ideal condition - Essay Example

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Hayek interprets the rule of law as referring to an ideal condition in which all government actions are bound by general rules that are fixed and announced beforehand. Hayek's ideal is one that can never be entirely realized in practice, but it does provide him with a fundamental standard against which all governments (however democratic) and their policies (however popular) can and must be measured…
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Social policy - the rule of law as referring to an ideal condition

Download file to see previous pages... Since the point is to restrain the coercive activities of government, these general rules should not be framed so as to discriminate either against or in favour of any group of persons known in advance-against Jews or Blacks, for example. Laws against speeding lay down general rules of this kind: they apply equally to all motorists, and they do not single out particular individuals (say, BMW drivers) for special attention. Retrospective legislation is likely to violate the rule of law on this interpretation since its victims and beneficiaries usually can be identified in advance. 1
General rules of this kind that are announced in advance are a defence against the arbitrary actions of governments. They are necessary in Hayek's view both for the proper working of the market and for the existence of liberty precisely because they allow individuals to plan their affairs secure in the knowledge that government powers will not be used deliberately to frustrate their efforts. Once governments go beyond the enforcement of certain general rules, their activities inevitably involve the coercion of particular individuals. ...
From this point of view there is no reason in principle why governments should not concern themselves with the regulation of economic affairs. But their interventions should take the form of a framework of laws within which markets can operate, rather than the direction of economic activity by a central authority. 2

Here and elsewhere, Hayek discusses government social and economic policy as if interference with market operations inevitably involves the infringement of liberty. It is not clear why that should be the case. Consider the example raised by Pigou in his review of The Road to Serfdom (Pigou 1944). The wartime practice of directing particular individuals into specific jobs is an infringement of liberty that may be defended for a limited period on the grounds of national emergency.3

This example, the occupational choices of individuals is certainly constrained as a result of government policy. But, from the point of view of those affected, the manner in which they are constrained is no different from the effects of market forces. It seems then that government interference in markets is to count as a coercive infringement of liberty, whether or not it is experienced as such by the individuals concerned. 4

Similar considerations apply to the welfare state. It is entirely proper for governments to be concerned with the welfare of their citizens, provided only that their welfare activities are constrained by the rule of law. The difficulty in discussing 'the welfare state', in Hayek's view, is that the term has no clear meaning. Some of the activities normally included under that heading are unobjectionable and may even 'make a free society more attractive, others are ...Download file to see next pagesRead More
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