Philosopher Hayek probes the limits of human rationality

Hayek on Liberty, by John Gray. New York: Basil Blackwell. 230 pp. $29.95. Friedrich August von Hayek is a true liberal. Perhaps more than anything else, a hard look at his thinking -- elegant, vigorous, and profound -- will help us revitalize that word.

Even more than those of philosophers Karl Popper (his good friend) and Ludwig Wittgenstein (his cousin), Hayek's career has been a cosmopolitan one. Born in Vienna (May 8, 1899), he earned two doctorates at the University of Vienna. In 1931 he was appointed Tooke Professor of Economic Science and Statistics at the University of London; 20 years later he became professor of social and moral sciences at the University of Chicago. Since the '60s, after retiring from Chicago, he has held professorships at t he University of Salzburg (Austria) and the University of Freiburg (West Germany). In 1974, together with Gunnar Myrdal, he won the Nobel Prize in Economics.

Like Popper and Wittgenstein, Hayek was deeply concerned with ``the fundamental question of the scope and limits of rationality,'' according to W. W. Bartley III, who is writing a biography of Hayek. Paul Gray, in his preface, notes that for Hayek, ``once we have arrived at a realistic picture of the powers and limitations of the human mind, we see that many important social doctrines -- those of socialism and interventionist liberalism, for example -- make impossible demands upon our knowledge.''

Without that realistic assessment, however, we have conceived of the modern state as a means toward social ends. But once the state becomes the object of a political tug of war between interested parties right and left, freedom is in jeopardy. Only ideologues from both ends of the so-called political spectrum will be involved in that kind of politics. As Hayek's famous ``The Road to Serfdom'' showed, the result of such political activity is that the worst, the most unscrupulous, will come out on top.

Over against this widely held complex of attitudes and ideas, Hayek pits his concept of ``spontaneous order'' -- that is, ``orderly structures which are the product of the actions of many men, but are not the result of human design.'' This is in keeping with Popper's insight into the role of the unintended consequences of human action. It's also in keeping with the classical liberal idea of the free market and the invisible hand. Hayek does not, however, endow the spontaneous order with a moral purpose:

Indeed, the totalitarian state, like the free, may well be the unintended consequence of political decisions and acts. The difference is that the free state evolves within a context of laws, not people.

Hayek's thought is enormously complex and subtle. Paul Gray's ``Hayek on Liberty'' is not only a sound introduction to Hayek, it is a valuable critique of the great liberal's lifework. Paul Gray is a fellow of Jesus College, Oxford, and author of ``Mill on Liberty: A Defence.'' ``Hayek on Liberty'' originated as a monograph published by the Institute for Humane Studies in Menlo Park, Calif. The institute, as Gray puts it in his preface, is devoted to research and scholarship in the traditions of classic al liberalism. In the late '60s, I benefited from the institute's hospitality and openness to new ideas when I delivered a paper on the philosophy of liberty. I was very young at the time; my interlocutors -- the institute is truly Socratic -- were considerably older and far wiser. They listened politely and asked questions just hard enough to make me think more.

Gray submits Hayek's thought to some tough tests. For example, he checks it against the thought of John Stuart Mill. Against Mill's individualism -- many conservatives need to hear this -- Gray posits Hayek's insight that human individuality is a ``cultural achievement'' rather than a natural endowment. Without the freedom to choose, human individuality remains latent, Hayek says. But the spontaneous order of society within law allows not so much for competing individuals as, in Gray's words, ``an arra y of flourishing traditions, each with its own sanctions against deviancy.'' ``A peaceful competition of rival traditions'' allows for the exercise of individual judgment. The growth of knowledge, the happiness of the individual, and political freedom are thus intertwined.

Hard thinking is what Hayek requires of us, liberal and conservative alike. I like the ring of the word ``liberal,'' but today a liberal is someone who feels the state should act in behalf of the politically and economically deprived. Would that it could! This kind of political action, as opposed to that of the individual which produces the spontaneous order we all have to live with, depends on our belief in our ability to control human events. Even something like rent control all too often has led to

neglect of existing properties and eventual scarcity of housing. And the availability of services in a welfare state such as Britain should make us think twice about such planning.

Hayek's thought, as Gray shows, has great integrity. There is continuity as well as growth. Born before the turn of the century, Friedrich August von Hayek is still writing and thinking. Both ``The Road to Serfdom,'' written in his ``spare time from 1940 to 1943,'' and the three volumes of ``Law, Legislation and Liberty: A New Statement of the Liberal Principles of Justice and Political Economy,'' are available in paperback from the University of Chicago Press.

Tom D'Evelyn edits the Monitor's book pages.