We saw with Hobbes and Locke the beginnings of a new type of political and moral theorising, which sought its grounding in the natural world, individualism and the so-called scientific perspective. While the various theories that have been recounted do not, of necessity, make a coherent whole, they nevertheless reflect the same Enlightenment ambition to produce a secular, naturalist and rational justification for our moral allegiances and social arrangements. As such, they represent a tradition of thought sharing certain presuppositions and ways of conceptualising, and in which the participants frame their thoughts in relationship to earlier thinkers in the same tradition.[69] This Enlightenment ambition has failed for reasons that will be explored shortly.[70]

This tradition, nevertheless, constitutes the complex of ideas—the background mood—on which market ideology and economic fundamentalism rely. With Locke, therefore, we have a view of property rights as being prior to society—a natural right, but one based on divine law. We also see the contract metaphor used to explain the existence of society. With such theorists as Mandeville, Hume and Smith , we see the gradual transformation of self-interest from being a source of moral failure to a source of public good, albeit moderated by competition and by a dash of sympathy for others. In the process, the divine, deistic underpinnings were removed gradually and replaced with nature and reason—concepts that were increasingly deified or reified. Through the alchemy of the Newtonian metaphor, these naturalist justifications of self-interest are turned into a formal moral theory in the form of utilitarianism. Of course, it is this utilitarianism that underlies much economic theory. With Spencer, the moderation—which was in Smith—was removed and instead the attempt was made to justify naked self-interest under the rubric of the survival of the fittest. They all share what Richard Rorty (1931–2007) calls Locke’s unfortunate desire to privilege the language of natural science over other vocabularies.[71] While Hayek wished to avoid that privilege, in seeing the market as a self-regulating system, he was ruling out government coordination and social risk sharing on a priori grounds; and it was reasoning that would enslave us to the economic system.

More recently, we have seen a major revival in contract thought as a consequence of Rawls’ A Theory of Justice.[72] Interestingly, Rawls’ idea of a reflective equilibrium as a way of evaluating our sense of justice—and as a theory of moral sentiments—is a deliberate echo of Smith.[73] It has already been argued that the concept of social relationships as contractual is taken for granted by economic fundamentalists and by economists generally and this is probably one reason why Rawls’ ideas have been so attractive. Indeed, David Gauthier claims that such a view lies at the core of the ideology of Western capitalism.[74] This ideology—this metaphor, this claim to conceptual priority—is now part of the deep, pre-reflective tacit structure of self-consciousness and the symbolic universe, the way in which we conceive of ourselves as human, the way we relate to each other, to structures and institutions and to the natural world. In this view, society is conceived of as merely instrumental, meeting no fundamental human need.[75] It also involves a view of ourselves as insatiable appropriators engaged in a competitive search for power, with rationality understood as being related instrumentally to the satisfaction of individual interests. Gauthier sums up the historical development of this ideology in the following terms:

What is to be appropriated is first thought of as real property, land or real estate. The distinction between land and other forms of property is then denied, and what is to be appropriated becomes the universal measure of property, money. Finally, in a triumph of abstraction, money as a particular object is replaced by the purely formal notion of utility, an object conveniently divested of all content. The rational man is…simply the man who seeks more. Thus it follows that not only the individualistic instrumental conception of rationality, but more precisely the individualistic utility-maximising conception, is part of the ideology of the social contract.[76]

The maximising conception of rationality entailed by contractualism and the natural-law outlook precludes the very possibility of rational agreement, because it undercuts the internal constraints necessary to maintain contractual relationships. In the past, radical self-interest was usually considered a primary threat to society, to be repressed by religion , law, morality and tradition. As has been argued in Chapter 3, the contractual tradition, contemporary economics and more especially economic fundamentalism have failed to understand the extent to which the social, political and economic orders have been sustained by motives different from those contained in the contractual conception of human nature. The faith that is placed in this contract tradition, and this form of theorising, cannot be sustained.

This chapter has provided a historical account of the intellectual tradition on which economic fundamentalism rests. Along the way, it has provided some criticism of this tradition, pointing in particular to the way in which it initially served the interests of wealthy British landowners. In the next chapter, I will deepen this critique by relating this tradition to the Enlightenment and criticising the intellectual arrogance that has flowed from that project.