chapter  4
17 Pages

The subordination of distributive justice in Milton Friedman’s Capitalism and Freedom

Roughly two centuries separate Adam Smith and Milton Friedman. The connection I wish to draw between their ideas is not a direct line of causation so much as to point out shared and ongoing foundational assumptions about justice, assumptions that I claim characterize liberal political economy. The thesis I have been arguing is the apparent disappearance of distributive justice from public view with the advent of liberal political economy in the late eighteenth century. I say apparent because, as I argued about his economic theory in Wealth of Nations (WN), Smith’s powerful concept of a naturally self-regulating market relied on a theory of social order that took a prevailing distributive order of society as natural and acceptable, while simultaneously excluding discussion of distributive justice from the public realm of politics. This exclusion constitutes the “disappearance” of distributive justice, but the acceptance of a prevailing social order gives mute testimony to the presence of a distributive order that resists questioning – a distributive order that defines the two central demands of distributive justice (one’s place in society and one’s subsistence) in terms of a commercial society. Smith’s exclusion of distributive justice from discussions of “real justice” (i.e., commutative justice) in Theory of Moral Sentiments (TMS) exerted a powerful influence in the intensive focus on individual freedom that developed with classical liberalism out of the eighteenth century into the nineteenth, and it continues to influence thinking today. Smith’s exclusion of distributive justice relegated it to private concerns, with the effect that both commutative and distributive justice came to concern the individual: commutative justice, as it had been before, being concerned with those aspects of the individual worthy of public attention like protection of life and property, and, in its new configuration, distributive justice concerned with those aspects of the individual not worthy of public attention – one’s position as an individual in relation to other individuals instead of one’s worth as a member of society. This is not to say that social standing as a measure of worth ceased to exist; rather, social standing was declared to be a function of individual measure, while still being practiced as sharing the status of a group. Social connections, in other words, remained important in actual (private) life but became obscured in public discourse in favor of an increasing emphasis on individualism and on societal decorum – a

decorum that shifted between that of a dominant social order and that of a commercial society. So from Smith’s time, a dynamic of accepting a dominant social order while excluding public discussion of distributive justice during the growth of a commercial society becomes a mark of liberal individualism. The exclusion of distributive justice worked by a process of naturalizing it, assigning its demands to the natural systems of society and economy, a process which was communicated by the use of appeals to character and characterization to establish a compelling picture of a proper decorum. This same dynamic is at work in Milton Friedman’s Capitalism and Freedom (CF ).1 While some of the specifics of Friedman’s arguments differ from Smith’s, the two share a common orientation in their strategic arguments: (1) to “real” justice defined commutatively; (2) to the divisions of public and private life that follow from the exclusion of distributive justice; (3) to the autonomous and natural selfregulation of both the social order and the market; and (4) to the central importance of competition in the market for that self-regulation. Their portrayals of a commercial decorum of proper behavior and marked approvals and disapprovals of character are how the prevailing social order’s distribution is accepted and confirmed as just. The exclusion of distributive justice in Smith’s TMS became taken for granted in Smith’s account in WN of how a free market would operate. By Friedman’s time, two centuries after the publication of TMS, the exclusion is barely remembered; distributive justice has become entirely subordinated to commutative justice, becoming a blind spot in liberalism’s theory of individual freedom.