Individualism and the State

Robin Waterfield's Dividing the Spoils focuses on the dawning of the Hellenistic Age after the death of Alexander the Great. He observes:

One of the most striking aspects of the Hellenistic period, by comparison with what came earlier, is its focus on the human individual. Social historians agree with historians of philosophy, art, and literature that this phenomenon is characteristic of the age.

Waterfield makes the link between this growth of individualism and the parallel rise in state absolutism:

By directing citizens’ energies toward the good of the state, the system allowed poleis to flourish, but the price was a higher degree of collectivism than most of us would find acceptable today. By contrast, we consider ourselves free the more we are able to avoid or ignore the state apparatus and remain within our private lives. A citizen of a Classical Greek polis had a far more restricted sense of privacy. Almost everything he did, even fathering sons and worshipping gods, was done for the good of the state—that is, for the good of his fellow citizens.
      The Macedonian empire, however, changed the rules. Although poleis retained a great deal of their vitality, the inescapable fact was that they had become greater or lesser cogs in a larger system....

The relative disempowerment of citizens as political agents that happened as the Hellenistic empires centralized power made it possible for people to see themselves, to a greater extent, as individuals, rather than just as contributors to the greater good. Rather than acting as a liberating force, it seems that the communitarian focus of Greek poleis was actually quite corrosive to individual self-expression. One thinks of Plato's Republic for one.

Waterfield goes on to observe how Hellenistic philosophers, like the Cynics and Epicurians, focused on individual esteem, as opposed to relationship between the individual and the state. Similarly, religious mystery cults offered personal emotional salvation. Women, too, saw large gains, enjoying far greater freedoms in the Hellenistic period than before. Even slaves seemingly were more often freed in this period.

Waterfield also connects these individual-level shifts with the broader political picture, which saw a host of post-Alexander successors contesting for territorial supremacy:

In the Classical period, this individualist form of greed was invariably regarded as a particularly destructive and antisocial vice, and it was expected that the gods would punish it or that it would arouse fierce opposition from other humans. The historian Thucydides, for example, thought that Athenian overreaching was one of the main reasons that they were defeated in the Peloponnesian War. The Successors trampled on such views. For them, and for all the Hellenistic kings who came after them, greed was good. Individualism and egoism are close cousins.

This reverses most of the typical associations. One typically thinks of political enfranchisement as going together with broader self-actualization; and greed as a corruptive force. We tend think of absolutism as the greatest enemy of individual agency. Waterfield suggests that, at least in one context, those relationships don't necessarily hold.

I find this a puzzling mix of strongly pro- and anti-libertarian attitudes. One one hand, this suggests that individual attachment to the state happens to the detriment of other aspects of individual flourishing; and that social mores encouraging egoism can promote individualism. On the other hand, it suggests that removing individual participation from the workings of the state is the best way to liberate people from this greater burden of being constrained by the forces of political participation.

Were Mellon and Hoover Liquidationists?

Josh Green's profile in The Atlantic of Ron Paul contains this section on interpreting Great Depression era policies:

The Austrian school had peaked in the early 20th century but had fallen away after the Great Depression, which it claimed was caused by an expansion of the money supply and could be met only with chastened submission as the market corrected itself. Herbert Hoover’s Treasury secretary, Andrew Mellon, offered similar counsel, famously urging Hoover to “liquidate” and “purge the rottenness out of the system.” But this failed to stop the catastrophe. Only when Roosevelt took the dollar off the gold standard and committed to deficit spending, and the Fed adopted consistently low interest rates, did the economy finally start to recover. This validated the argument of the Austrians’ intellectual adversaries, economists like John Maynard Keynes, that rather than stand aside, governments should intervene to mitigate recessions.

The idea that Mellon advocated "liquidation," and that the adherence to this strategy were among the major contributors to the depth of the Great Depression are widely held views. However, they are simply not true, as Lawrence White explains.

First, the quotations attributed to Mellon in fact come from Hoover's own autobiography. Here's what Hoover had to say:

First was the “leave it alone liquidationists” headed by Secretary of the Treasury Mellon, who felt that government must keep its hands off and let the slump liquidate itself. Mr. Mellon had only one formula: “Liquidate labor, liquidate stocks, liquidate the farmers, liquidate real estate.” He insisted that, when the people get an inflation brainstorm, the only way to get it out of their blood is to let it collapse. He held that even a panic was not altogether a bad thing. He said: “It will purge the rottenness out of the system. High costs of living and high living will come down. People will work harder, live a more moral life. Values will be adjusted, and enterprising people will pick up the wrecks from less competent people.”

While apparently damning, White explains that this passage was primarily intended to highlight the differences between Mellon's views and those of Hoover. The "quotations" likely do not reflect Mellon's actual words, but are rather exaggerated for effect.

While Mellon recognized the need for painful readjustments, he was in reality not the extreme liquidationist portrayed either by Hoover or Josh Green. He supported successive interest rate cuts by the Federal Reserve, and tax cuts and spending measures by the Federal Government.

Nor did Hoover follow a liquidationist policy either. Rather, as his own autobiography and the historical record amply demonstrate the extent of his intervention in the economy. Deficit-fueled spending grew dramatically under his tenure. Among many other initiatives, Hoover's Reconstruction Finance Corporation lent billions to banks, states, and other firms.

In fact; it was Roosevelt who re-introduced fiscal balance by 1937-8. This period also saw dramatic monetary tightening by the Federal Reserve, a move convincingly linked to a recession that began at that point.

Though tempting to think of historical figures solely through a stark moral lens, the lessons of the 1930s are more complicated than commonly realized. Far from being a stark "liquidationist," both Hoover and Mellon worked to orchestrate dramatic federal interventions that nonetheless failed to secure recovery. More durable recovery happened under Roosevelt; but even under his tenure Federal Reserve officials erred badly in sharply contracting the money supply and plunging the country into a new downturn. Finally, federal interventions by both Hoover and Roosevelt that regulated prices and wages throughout the economy likely had negative effects on economic recovery.

While analyzing the beliefs of long-dead historical actors may be tedious, the depth and duration of the current crisis have brought increased relevance to the actions of Great Depression-era policymakers who faced similar problems. Their actions, real or perceived, continue to inform policy debates today. That's why it's important to set the record straight on their actual policies.