Early ordoliberalism demanded a strong independent state to counter organized interests

Evidence

These early writings all made the explicit admission that classical theory had underestimated the necessity of a state taking active measures in ideal market economies, combined with scathing attacks on the actual political system of the Weimar Republic. It was largely the tendency toward the so-called Wirtschaftsstaat (Eucken’s “economic state”) that was harshly criticized and blamed for shifting political and economic power to various organized interests. Owing to the rise of powerful special interests, the state was considered the easy prey of political parties (“Staat als Beute”: Rüstow 1932, 171). As a consequence, the state was rendered incapable of acting independently for the larger good, at least according to the early ordoliberals. They argued in favor of resurrecting the classical liberal dualism of state and society, but conceived of the need for a positive state authority superior to all the powers present in society. To posit “independent” state authority favorable to the functioning of the market thus required an active role in institutional design, one that resembles the subsequent efforts of public choice theory and rational choice-based neo-institutionalism. — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 524

Categorization

• DEFINE: Defines the core ordoliberal notion of the Wirtschaftsstaat and its remedy: an independent state authority raised above society’s organized interests.
• XREF: Connects to public choice theory and rational-choice neo-institutionalism — same move from interest-group capture to institutional design. — connects to: Ordoliberals saw the economic constitution as imposed by deliberate political will from above — Quinn Slobodian, Globalists: The End of Empire and the…, 697; Early neoliberalism rejected laissez-faire in favor of a state-built competitive order. — Dieter Plehwe, Quinn Slobodian & Philip Mirowski (eds.), Nine Lives of Neoliberalism, 365; Early neoliberals rejected laissez-faire and wanted strong state action (+6 more)

Broader Connections

• Early ordoliberal and Austrian critiques of parliamentarism harbored authoritarian leanings #expands (0.80) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 543
• German ordoliberalism combined a strong-state Ordnungspolitik with sociocultural individualism and postwar integrationism #qualifies (0.80) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 515