Introduction

The concerns of this contribution can be summarized with reference to a recent publication by Viktor Vanberg.¹ In this publication Vanberg offers a succinct summary of the ordoliberal meaning of Ordnungspolitik, focusing on economic constitution and on the indispensability of the liberal state for the free economy.² According to Vanberg, economic constitution and political constitution presuppose each other. In distinction to the founding ordoliberal texts of the early 1930s, he establishes the principles of Ordnungspolitik with scientific insight and analytical precision. The political urgency of the founding ordoliberal texts is missing and their contribution to the emergence of an authoritarian liberalism is not raised. Carl Schmitt does not figure in his account, which is cleansed of unsavoury references to the ‘authoritarian liberalism’ that Hermann Heller³ and also Herbert Marcuse⁴ talked about when determining the character of his argument in the early 1930s.

Clearly Schmitt is not a liberal economic thinker. He is the authoritarian thinker of the political state as the institution of sovereign decision-making. Nevertheless, Schmitt’s insistence that the state is properly a state on the condition that it sustains its distinction from (mass) society is not at all at odds with, in fact it is central to, conceptions of the free economy as a depoliticized sphere of rules-based exchange relations between competing property owners. “What are the rules of the game”?⁵ Who puts them in place, oversees, modifies and enforces them? Who then is charged with depoliticizing the social relations, ensuring their rule-based conduct, and facilitates competition for which, as Böhm saw it,⁶ there is no lobby? Who, finally, constrains the passions of self-interest, pluralist demands for protection from competitive pressures, and class specific demands for welfare security from the vagaries of the labour market? In the (ordo)liberal argument, the institution of institutions is the state. It is not only the power behind the economic constitution, the force of law, it is also the guardian of the constitution, the force of law preserving violence, which, in the ordoliberal argument, characterizes the state as “market police”.⁷ In the economic-liberal argument, therefore, the separation of state and society as distinct spheres of social organization is of central importance. The state lays down and enforces the rules of the game and it does so in order to facilitate the conduct of society in freedom from direct forms of domination and coercion. In the words of Hayek, “man is free if he needs to obey no person but solely the law”.⁸ In the authoritarian liberal argument, this freedom is unthinkable without the independent power of the state as the principal authority of order and law. Indeed, and as I set out to argue here, authoritarian liberalism conceives of the free economy as an order of state. It recognizes the economic constitution of liberty as a political practice of order (Ordnungspolitik).

Schmitt’s authoritarian liberalism emerged as an argument about the causes that led to the breach of the distinction between state and society and about how to renew their separation in a mass democratic context. The slogan “sound economy and strong state”⁹ expressed the programme of authoritarian liberalism. It demanded the depoliticization of society through the politicization or “existentialization” of the state.¹⁰ Whilst contemporary ordoliberalism is keen to remove Schmitt from discussion about Ordnungspolitik, critical commentators are undecided whether it was Schmitt who influenced the ordoliberals¹¹ or whether it was the ordoliberals who influenced Schmitt.¹² The contribution expounds Schmitt’s contribution to the authoritarian liberal argument about the politics of the order of freedom (Freiheitsordnung). Authoritarian liberalism recognizes freedom as an expression of order. Exploration of Schmitt’s stance is helpful in delineating the political premise of the free economy, which in the words of Böhm amounts to an eminently political practice.¹³ Ordnungspolitik is therefore also a politics of the political constitution of the state to ensure its liberal utility in a mass democratic age.

The following subchapter presents Vanberg’s account of Ordnungspolitik (1.). His argument links economic constitution and political constitution in a clear and precise manner. Then follows a subchapter on Schmitt’s critique of the Weimar “economic state” (Wirtschaftsstaat),¹⁴ which is a central term of critique in ordoliberal thought, including especially Eucken’s contribution (2.). The final subchapter examines Schmitt’s idea of the strong state as the premise of the free economy (3.). The conclusion summarizes the account with reference to the ordoliberal conception of order(ing).

1 Ordnungspolitik and the Strong State

Vanberg expounds the separation of state and society as fundamental to the constitution of a free economy. He recognizes that in this relationship the state is the institution of institutions. The separation of state and society is a practice of Ordnungspolitik.¹⁵ That is, the maintenance of state-free spheres of economic interaction amounts to a political task. By implication, the assertion of political power in society, and conversely, the assertion of economic interest at the level of the state amount to a failure of Ordnungspolitik. It leads liberal economy down the path on the road to serfdom, as Hayek famously put it.¹⁶ According to Eucken, whose work Vanberg relies upon in his account of Ordnungspolitik, the failure to maintain state and society as separate spheres led to the emergence of the Weimar democratic welfare state, which Eucken, like Schmitt, characterizes as a Wirtschaftsstaat, that is, an economic state¹⁷ of not only total social responsibility but also of planned chaos.¹⁸ In the economic state the “lash of competition”¹⁹ is replaced by competition for regulative privileges, which, as authoritarian liberalism argued, exhausted the innovative capacity of capitalism and damaged its “automatic mechanism” of self-regulation through “market prices”. The potential of liberal economy to achieve “the highest economic prosperity”²⁰ was thereby undermined.

According to Vanberg, however, the assertion of ‘private economic power’ as such does not pose a threat to the free economy. In fact, such assertion belongs to its concept. The threat comes from a political order that fails to stay strong in the face of such assertion, ranging from pluralist demands for special measures to mass democratic demands for welfare protections. He conceives of such a state as a weak state because it succumbed to the clamour of the private interests and the social forces. The “state should on no account be allowed to confer privileges”²¹ and the liberal state has therefore to be a strong state²², a night-watchman state will not do. Only a strong state can prevent the “(re)feudalization” of state and society and act as “guardian of the competitive order”.²³

Vanberg argues his case with reference to Eucken’s view that the Weimar state had become “a plaything in the hands of interest groups”.²⁴ Whereas the weak state gives in to the demands of recalcitrant social interests, the strong state is characterized by its capacity for independent decision-making, which is seen as a requirement for maintaining the relations of economic liberty, enterprise competition, and entrepreneurship. It lays down the rules of the game and enforces the rules decided upon, including especially the rules of competition. It is, as mentioned above, the ‘guardian of competitive order’. Only a strong state can constrain the passions and the interests, as Hirschman²⁵ put in his account of the classical case for “commercial society”.²⁶ In contrast, a weak state succumbs to them and is governed by them. Since free economy is a “genuine and indispensable political task”²⁷, the state cannot be an outgrowth of “unlimited majoritarian rule”²⁸ and the practice of government cannot be guided by unlimited democratic demands.²⁹ “Liberal interventionism”,³⁰ “planning for competition”,³¹ and a system of unlimited mass democracy belong to different worlds. However, Vanberg does not argue against democracy. On the contrary, he argues for liberal-democracy as a system of government, in which the democratic character of the state is tied to its liberal foundation and which on this basis preserves not only the liberal utility of the state within mass-democracy but also ensures the peaceful circulation of governing elites through competitive elections, as argued by Schumpeter³² and Hayek.³³/³⁴

Crucially, therefore, Ordnungspolitik is not only needed “to establish an appropriate economic constitution, Ordnungspolitik is also needed at the level of politics [...] to establish and maintain an appropriate political constitution”,³⁵ one that, in the face of immense pressures brought to bear on the conduct of public policy by powerful interest groups, political parties, and the social forces, enables the liberal state to preserve its independence and one that, therefore, facilitates its liberal utility as “market police”,³⁶ that is a state which in Hayek’s phraseology “plans for competition” through a politics of what Rüstow calls “liberal interventionism”. The establishment of an economic constitution and of a political constitution is a matter of Ordnungspolitik. Ordnungspolitik entails ‘the whole’. It amounts to a Gesamtentscheidung about the character of political economy, of state and economy, and about the character of their relationship. Ordnungspolitik is therefore also a ‘decision’ about the basic norms of conduct in liberal economy. In the case of a society founded on the freedom of competition, what are the ground rules and what kind of (social) order is required to sustain its conduct? In this context, the meaning of economic constitution refers to the ground rules and basic norms that constitute the economic order in its totality.³⁷ However, order is a political category. Vanberg therefore conceives of the liberal economic order as a “product” of “constitutional economic policy”.³⁸ Its task “is to create conditions under which the ‘invisible hand’ that Adam Smith had described can be expected to do its work”.³⁹ The invisible hand does not do its ‘work’ unless it is facilitated to do so by a ‘constitutional economic policy’ that removes all ‘orderlessness’ (Böhm) from the social relations – removing distortions and impediments from markets, curtailing the influence of private power, trade unions and the political parties, on the conduct of government and depoliticizing the socio-economic relations.

Ordnungspolitik entails therefore not only an “integrated approach to the various components of the legal-institutional framework in which a market economy is embedded”.⁴⁰ It entails also an integrated approach to the various components of the political framework, including the scope of democratic control over, and influence on, the conduct of public policy. Ordnungspolitik specifies “the essential role that government has to play in defining and enforcing the legal-institutional framework”.⁴¹ For the sake of the system of economic liberty, and in the words of Schmitt, the political constitution has therefore to set out the “precise limits”⁴² in which the state has to act in accordance with and for the sake of what is Right and proper in a liberal political economy.

2 On Schmitt’s Critique of the So-Called Weimar Economic State

In his The Guardian of the Constitution Schmitt argues that prior to the incursion of mass democracy into the liberal state, state and society were clearly separated with the state successfully claiming the monopoly of the political and the economy self-regulating on the basis of “the automatic mechanisms” of “demand and supply, competition, market prices”, etc.⁴³ According to Schmitt, the mass democratic age of Weimar ruptured the separation between state and society with the result that state and society became essentially identical. The rupture focused on the change in character of the institution of parliament, which, he argued, transformed from a liberal parliamentary representation of the interests of private property into a mass democratic chamber that was dominated by mass parties representing mass demands. In his view Weimar mass democracy was not limited by the liberal principle, leading to the emergence of the Weimar democratic welfare state, which he dubbed in line with ordoliberal thinking an economic state. He saw the economic state – “a cultural state, a welfare state, a social security states, a provider state”⁴⁴ – as a consequence of unlimited mass democracy, which required the state to attend to the social interests from the cradle to the grave. In his view, the Weimar state no longer governed. On the contrary, it was governed by the social interests, which led to the emergence of a state of total quantity, that is, the economic state is a state of total responsibility for all sorts of issues. The politicization of the social relations went hand-in-hand with the depoliticization of the state. He saw the Weimar state as a totally weak state, which as a mere outgrowth of society had lost its distinction as the monopoly holder of the ultimate decision about friend and enemy,⁴⁵ about what is Right and proper. The remainder of this section sketches Schmitt’s account of the economic state as the emergent result of the capture of the liberal state by a mass democracy unconstrained by the liberal principle⁴⁶.

In the Guardian of the Constitution, Schmitt argues that the old liberal state possessed elements of an executive state (Regierungsstaat) that was “strong enough to stand above and beyond all social forces”. He argues that the liberal state of old comprised a dual structure that embodied two different forms of state: a parliamentary legislative state [Gesetzgebungstaat], which was the representative body of the propertied and the educated classes (Besitz und Bildung), and an executive state (Regierungsstaat), which expressed monarchical interests and was administered by aristocratic officeholders.⁴⁷ The dualist structure comprised thus a democracy of propertied friends and government by the ancien régime. Schmitt acknowledges that this structure was contradictory and tension-ridden with traditional economic and political élites battling an upcoming bourgeoisie that demanded reforms in support of its own economic interests. Nevertheless, this conflict was between different private property owners. It excluded the property-less. Schmitt argues that the dual structure of the liberal state fell apart with the German democratic revolution of 1918. He thus argues that, with the assertion of mass democracy, the legislative state supplanted the executive state, which in his view made government dependent on the governed. With mass democratization, the capacity to sustain substantive liberal economic values was lost. Politics became mass politics, and the liberal rule of law became the rule of law of shifting parliamentary majorities, mere process law. Following William Scheuerman, “the democratisation of parliament in conjunction with the simultaneous parliamentarization of the state means that no element of the state now ‘stands above and beyond the social forces’”.⁴⁸ Not only was “classical [liberal] parliament [...] defiled by the prevalence of democratic ideals”,⁴⁹ the unity of the state disintegrated as “parliament” lost the “autonomy required” to decide upon the rules of the game independently from the social forces. Instead, “the diverse interests pullulating in civil society” gather as “commissioned agents” on the parliamentary benches organized around party blocs, representing “recalcitrantly opposed interests”, which decide by simple majority on the rules by which society and economy is governed.⁵⁰

For Schmitt, society had taken possession of the state with profound socio-economic consequence: “if society organizes itself into the state, if state and society are to be basically identical, then all social and economic problems become immediate objects of the state”.⁵¹ Paraphrasing Schmitt, the stranger, this figure of ‘the enemy within’, enters the liberal state and asserts her interests as an equal, that is, in mass democracy unconstrained by the liberal principle, control is exercised by those who need to be controlled. With mass society asserting itself within the state as its democratic sovereign, the state loses its quality as a state of Right. It is no longer able to distinguish between the Rights of private property and the demands of those without property, sacred values and coarse demands for material support and security.

Mass democracy defiled the liberal state of old and supplanted it by a mass democratic state, which in the view of Schmitt is no longer a state properly understood as the monopoly holder of the ultimate decision about what is right and rightful. In unlimited mass democracy there are no longer any substantive values. There is only relativism. Relative values, he argues, belong to a depoliticized condition of government that has lost the capacity and the courage to spill blood for the sake of Right, for the order and the tranquillity of Right and rightfulness. In contrast to the political state of sheer quality – of authoritative, independent decision-making about the rules of the game and their execution – the economic state is fundamentally a socialized state.

Schmitt’s account puts particular emphasis on the democratization of the rule of law in the economic state of total social responsibility. He argues that majoritarian democratic law making de-theologises the rule of law as the law of divine Rights. In its stead it manifests law as process-law, reducing the rule of law to a procedural formalism. Legality is the principle of mass democratic law-making, which attributes legitimacy to legal-rational processes and procedures. It is, says Schmitt, “nothing more than mob rule”.⁵⁷ In explanation, Schmitt holds that the old concept of legitimacy, which had to do with dynasty and royalty, divine values, and acceptance of nobility and social hierarchy, and above all property and standing, had given way to rational-legal forms of legitimation that supplant social enchantment, loyalty to King and country, and sanctity of the government of private property and decency, by principles of equal rights and disenchantment of social life by processes of socio-economic rationalization. Nothing seemed sacred anymore. In modernity politics had become mass politics, which is characterized by rational administration and technical regulation, and material demands for satisfaction in the here and now. What remains is government by econometricians, technical experts in the regulation of unfathomable economic quantities, as Röpke argued some years later in his The Moral Foundations of Civil Society of 1944.⁵⁸ The state of total quantity replaces the state of total quality, as Schmitt argued in 1932.⁵⁹ Concerning the liberal rule of law, legal formalism replaces a legal order founded on legitimate Rights. In legal formalism Right collapses as the framework of law. Instead, law is what majoritarian democracy considers it to be, from one day to the next. Legitimacy ceases as a category of Right, righteousness, and rightfulness. It now appears as a legal-rational category of due process. In a mass democratic society legitimacy means lawfulness and correctness of procedure. It can be the rule of socialist law or liberal law, or it can be fractured and fragmented as the rule of both, mere disorder.

In conclusion, in mass democracy law becomes arbitrary, unpredictable, and profane, and above all contradictory and inconsistent. It no longer establishes the rules of the game of an economic order based on the Rights (and graces) of private property. Instead of a “constitutional economic policy” (Wirtschaftsverfassungspolitik)⁶⁰ that lays down and enforces the ground rules and the basic values of a depoliticized exchange society, the economic state politicizes the economic relations and allows the economic interests to “economize” or “socialize” the state, transforming the former sovereign of the political into a depoliticized institution through which those who need to be governed assert their interests as democratic equals.⁶¹ In the democratized Rechtsstaat Right and rightfulness collapse as concepts of order and ordering. There is no more politics. There is only jostling for political influence by the rent seeking social forces. The Rechtsstaat becomes a mere semblance of a state as the competing social interests capture aspects of the state to advance their own “unsocial” interests as matters of public policy, fragmenting and decomposing, and above all depoliticizing the one institution that was capable to “produce Right” (Recht zu schaffen).

As the following subchapter argues, for Right to prevail in a mass democratic context, constraining mass democracy on a liberal basis is of the essence. Fundamentally, it entails an attempt at rolling mass society out of the state, at eliminating or eradicating heterogeneity for the sake of an order of state that governs for the homogeneity of purposes.⁶² In short, it requires the independence of political will, and above all, it requires an existential decision about whose blood needs to be spilled for the sake of an order of Right and righteousness. The separation of state and society amounts to a decisive political procedure, one that reacts to the supposed dethronement of the political by – unlimited – mass democracy with a force that eliminates any doubt about the veracity of the action.⁶³ It is an act of removing the state as an available means by which “everybody wants to enrich themselves at the expense of everybody else”⁶⁴ and it is an act of “existentialising” the state as the independent power of the sound (free) economy.⁶⁵

3 Strong State – Sound Economy

I have argued that for Schmitt the liberal state of old had been “strong enough to stand above and beyond all social forces”. It had possessed elements of an “executive state” and maintained its independence from a graceless mass society of propertyless traders in labour power. It was because of its independence that it was able to “relativize”, that is to pacify, the social conflicts.⁶⁶ According to Schmitt, the depoliticization of society entails the politicization of the state as the concentrated power of depoliticization and, conversely, the politicization of the state entails the depoliticization of society as, in the words of ordoliberalism, an enterprise society. That is to say, the concentration of the political in the form of the state entails the depoliticization of society as a law-governed exchange society of competing entrepreneurs, in which everybody is at liberty to dispose of their property as they see fit as equals before the rule of law regardless of the inequality in property that distinguishes the liberty of the rich from the freedom of the poor to dodge starvation.⁶⁷

The liberal-conservative dictum that the state ought not to have any power at all outside its sphere and that within its sphere it cannot have enough power has formidable consequences. It says, first of all, that the freedom of exchange under the rule of law is dependent upon the capacity of the state to limit itself to Ordnungspolitik and thus to prevent itself from becoming the prey of the recalcitrant social interests. That is, the state-free sphere of economic interaction entails not only a political practice of socio-economic depoliticization. In the face of assertive social forces and mass demands, it entails also a political practice of maintaining a rightful order, producing Right. Any weakening in its resolve has the potential to undermine the concrete order of the free economy. Order is the premise of freedom and of equality before the law. That is, equality before the rule of law presumes the order of law as an order of inviolable Rights. The rule of law does not apply to social disorder, as Schmitt points out. It only applies to social order. Therefore, government by the rule of law entails a politics of social order. In the authoritarian liberal conception, the saying “law and order” appears as fundamentally flawed. Since social order is the premise of the rule of law, of Right and rightful-ness, the reverse of the saying is true: “order and law”. Schmitt’s authoritarian liberalism clearly understands that the political state of economic liberty is the institution of the order of Right and law. It is the order making and the order preserving power. In Schmitt’s argument only the strong state has the capacity to govern for what is right, righteous, and rightful. It alone has the capacity to govern for the economic constitution of a depoliticized exchange society, and as such it is the institution of institutions.

Schmitt’s argument about the elements of the executive state in the liberalism of old recognized that laissez-faire is not a concept that applies to the conduct of government.⁶⁸ It applies to depoliticised economic relations. Only the strong state can tolerate mass democratic procedures.⁶⁹ According to Schmitt the people “can only engage in acts of acclamation, vote, say yes or no to questions posted to it from above”.⁷⁰ The people “cannot counsel, deliberate, or discuss. They cannot govern or administer, nor can they posit norms (...). Above all, they cannot pose a question, but can only answer with yes or no to a question placed before them”.⁷¹ Furthermore, restricting the scope of mass democratic interference with the conduct of government entails the strong state as an always watchful security state. Schmitt accepts that in the liberal tradition the rule of law stands for the “protection of citizens from the abuse of state power”.⁷² The rule of law entails therefore the notion of Rechtsstaat, which according to Schmitt is a “strictly controlled steward of society”.⁷³ Nevertheless, he argues, the liberal Rechtsststaat is first and foremost a state.⁷⁴ This state establishes for the free citizens the social order upon which their security rests and it secures the order of freedom by laying down the ground rules and by enforcing the rules decided upon to protect them from “bloodshed and disorder”, as Smith put it.⁷⁵ Their security under the rule of law is not God-given. It is state-given, says Schmitt. As the institution of social order, the state therefore “stands outside the normally valid juridical order and yet belongs to it”.⁷⁶ The liberal rule of law does not decide on whether it has been subverted by illiberal democratic majorities or the forces of political pluralism. Institutions do not make decisions. Individuals do. Whether the liberal rule of law applies is, therefore, not a matter of law – it is a matter of sovereign judgment about the validity of the rule of law in any given situation. Whether to govern through the rule of law or whether to suspend the rule of law, ostensibly in order to preserve it for later once the proclaimed emergency is over, is a matter of sovereign judgment about the degree of social disorder. Order is a political category of disorder in the mode of being denied. Schmitt thus insists that “all law is situational”, and, at unpredictable times “the power of real-life breaks through the crust of a mechanism that has become torpid by repetition”.⁷⁷ For Schmitt, the Rechtsstaat is a state on the condition that it accepts and manifests the power to produce Right and to sustain Right in the face of mass demands for welfare provision, which characterizes the economic state of pure quantity. In his view, liberal neutrality towards what is right and proper has no values to defend and invites with open arms the forces that will devour its cherished liberty. In Schmitt’s view therefore, the required state of total quality is neither a night-watchman state nor a technocratic machine. It is a vigilant security state⁷⁸ that sniffs out the potential for disorder in the mentality of the governed.

Schmitt argued that unlike the quantitatively total state of social interventionism, the strong state is a state of total quality. It is the concentrated power of social order and ordering. Producing Right entails a politics of Right. It sustains the veracity of social order by ensuring the validity of the rule of law as a rule of Right, and if need be it suspends the rule of law during proclaimed liberal emergencies to contain the forces of social disorder, if need be by politicizing the “friends” as faithful agents of a politics of “ordering”. If necessary, it spills blood for the sake of re-establishing for the rule of law that social order upon which its rightful conduct depends.⁷⁹ The strong state is not only “bound by precise rules”,⁸⁰ it also sets these rules, ensures their veracity and, if required, suspends them for their own sake, whatever it takes. It governs the conduct of society as a security state. That is, the state-free spheres of society and economy are themselves not only a product of government. They are also a practice of government, a practice of Ordnungspolitik, which sets down the rules for the conduct of freedom. Freedom is an expression of order and an exercise of orderliness. In the context of the Weimar democratic welfare state, which he rejects as an economic state, he called for the “necessary depoliticization and restoration of the domains and spheres of a free life” by means of state. He demands the reassertion of the state as the sovereign power of sound economy,⁸¹ one which governs with the independence of will for the freedom from political interference in economic life.⁸² Against the supposed dethronement of the political through the mass democratic usurpation of the state, he demands, following Marcuse, the “existentialisation and totalisation of the political sphere”, politicizing the state as the indisputable power of socio-economic de-politicization.⁸³ The politicized state of order and law reacts to the “threatened freedom and security of private property” and acts with unbound authority.⁸⁴ The decision to act reveals the political sovereign. For Schmitt, the sovereign is the one who decides on a state of exception to ensure, produce and sustain, the order of freedom under the rule of law. Or as Alexander Rüstow saw it in 1929, the free economy requires the availability of a commissarial dictator within democracy, an extra-legal decision maker who judges the situation of the rule of law to ensure the order of (economic) freedom against a mass democracy that does not know how to limit itself.⁸⁵

In conclusion, and with reference to Rüstow, the economic state is a state of “lamentable weakness”; it is “pulled apart by greedy self-seekers. Each of them takes out a piece of the state’s power for himself and exploits it for his own purposes”.⁸⁶ Schmitt recognized the unpredictable power of real life in the reality of the political situation of a mass democratic age. If required blood needs to be spilled for the sake of a righteous order of Men (Menschen) who combine peacefully and guided only by their self-interest in the stateless sphere of the economy, each pursuing their own interests as equals under the rule of law and under the watchful eye of the authorities.⁸⁷

Conclusion

I have argued that Schmitt likens the Weimar democratic welfare state to “mob rule”.⁸⁸ He identified the time of egalitarian mass democracy as an illiberal disorder. The identification of a state of disorder entails the declaration of a state of emergency. Its declaration amounts to a sovereign decision, which is valid because of itself. Any doubt in its veracity needs to be eliminated by the force of its execution. Decisionism, in which an unregulated act of power is taken, suspends the “legislative state” of mass democracy. It casts aside the formalism of law and the protections that it affords. The Schmittean state of emergency governs by decrees. Restoring the order of legitimate Rights, “whatever it takes”, is not a matter of a politics of law and order. It is a politics order making (Ordnung schaffen), of law restoring or law-making violence. In the case of the former, a commissarial or transitional dictatorship suspends the rule of law so that it may be preserved in the long run; and in the case of the latter, a sovereign dictatorship, like Lenin’s, establishes a new order of society. In the case of the former, the decision to identify, declare and prosecute a (liberal) emergency manifests the assertion of (an unbound) executive state that governs, in the words of Rüstow, with “authority and leadership to resolve the declared crisis of the system of free enterprise”.⁸⁹ However, the decision to suspend does not resolve the crisis. It recognizes the identified crisis in the adopted action. Once the decision to suspend has been made and once the battle to remove the “mob” as a democratic equal has commenced, the recovery of what is Right changes into what Schmitt called “concrete order thinking”.⁹⁰ As Alfred Müller-Armack had already put it in 1932, we need to “invent (erfinden) an objective order constellation (Ordnungsgefüge)” to institutionalize free economy.⁹¹

I have argued that for Schmitt the emergence of Weimar mass democracy amounted to a fundamental alteration in the structure of state and society. “By yielding to democracy and intervening in society’s spontaneous order the state became a ‘welfare state’ and in this process lost its autonomy and independence, its neutrality and strength”.⁹² For the sake of Right and rightfulness, and following Eucken, the state had to act: it must find “the strength to free itself from the power of the masses and to distance itself in some way from the economy”.⁹³ Schmitt’s critique of Weimar mass democracy sought to locate “the centre of gravity of the decisive will”,⁹⁴ which he found in the office of the President that, for him, was the one institution that possessed the monopoly of the ultimate decision to suspend lawfulness for the sake of rightfulness. The founding ordoliberal thinkers argued likewise. They too saw the need for the state to disentangle itself from the grip of the social forces to “safeguard the unity of its will formation” and to acquire “the real independent power to make its own decisions”.⁹⁵ Indeed, and in the words of Schmitt, the “dreadful coalescence” of the state and all kinds of non-state interests needed to be remedied by a “painful surgical intervention”.⁹⁶ Or as Eucken argued the state has to find the political will to insulate itself against attempts at influencing it.⁹⁷

Following Schwab, Schmitt’s critique of the Weimar economic state attempted at “devising a constitutional order that would once and for all drain society of political forces that could challenge the state’s monopoly on politics”.⁹⁸ It entailed the establishment of a constitutional order comprising, on the one hand, a politicized state of pure quality and the establishment of entirely depoliticized socio-economic relations, on the other. For Schmitt, the organization of a depoliticized societal order is an outcome of a politics of (re-)order(ing). It is an outcome of a specific use of state authority.⁹⁹ In the context of mass democracy, which he depicts as the seizure of the state by the mob, mass society had first to be “rolled back” out of the state and once the state had re-established its independence from the social relations Schmitt envisaged, as argued by Cristi,¹⁰⁰ the creation of parliamentary institutions with weak democratic ties. He envisaged the restoration of the legislative state as a representative body that “does not yield to democratic pressures”¹⁰¹ and an executive state modelled on the idea a presidential power, which combines plebiscitarian democratic elements with decisionist authority. Further, in his “Strong State and Sound Economy” he envisaged three forms of economic activity comprising the sphere of “pure privacy”, a nationalized sector consisting of major services such as the postal service, and the “intermediate non-state, but still public sphere” of corporatist interest mediation, or “autonomous economic administration” between the so-called social partners.¹⁰² In contrast, ordoliberal concrete order thinking favoured an economic constitution of complete competition, depoliticized forms of market supervision and enforcement, political decision-making based on expert advice¹⁰³ and, one might add, transformation of mass democracy into a liberal-democratic order. Hayek stands out for his proposal of a system of interstate federalism¹⁰⁴ in which the market regulating media of law, market competition and money constitute a market liberal supranational framework for the conduct of mass democracy at the national level.¹⁰⁵ Leaving aside the differences in “concrete order thinking”, their shared presumption is that a free labour economy “cannot function without Obrigkeit”.¹⁰⁶

Hermann Heller’s characterization of Schmitt’s scheme of “sound economy and strong state”,¹⁰⁷ legislative assembly and executive state, as an exemplar of authoritarian liberalism¹⁰⁸ is well founded.¹⁰⁹ According to Heller, a state “that is determined to secure ‘the free labour power of those people active in the economy’ will(...)have to act in an authoritarian way”.¹¹⁰ Authoritarian liberalism conceives of the free labour economy as an eminently political practice¹¹¹ and characterizes it as a political event (politische Veranstaltung).¹¹²

In conclusion, Schmitt’s work of the early 1930s stands for a “simultaneous affirmation of an authoritarian state and a free liberal economy”.¹¹³ He argued for the “segregation of the state from non-state spheres” and recognizes that the “disengagement from politics is a specifically political act”.¹¹⁴ Man is free if he has to comply only with the rules of the game. Ensuring compliance amounts to a political practice of market police. That is to say, for the sake of freedom, “all orderlessness”, market distortions and impediments, has to be eradicated by means of state and for the sake of enterprise, self-responsibility and acceptance of individual liability for the consequences of decisions made in freedom from coercion.¹¹⁵ Economic freedom is an ordered freedom, which is the “product” of “constitutional economic policy”.¹¹⁶ The ordoliberal idea that “the state has to be as strong as possible within its own sphere, but that outside its own sphere, in the economic sphere, it has to have as little power as possible”¹¹⁷ is also Schmitt’s. In either case, be it Schmitt’s authoritarian liberalism or ordoliberalism’s Ordnungspolitik, the dictum is well understood.¹¹⁸

Acknowledgments

I am grateful to Pavlos Roufus and Guillaume Grégoire for their most helpful advice, and to Rosanna Pope for her careful reading.