Is Libertarianism compatible with democracy?

An eye-opening article from Ann: "Why Libertarians Appologize for Autocracy."

it is curious that American conservatives and libertarians have not seen fit to discuss the view of fascism held by one of the heroes of modern American libertarianism, the Austrian economist Ludwig von Mises. In his book "Liberalism," published in 1927 after Mussolini had seized power in Italy, Mises wrote:

It cannot be denied that Fascism and similar movements aimed at the establishment of dictatorships are full of the best intentions and that their intervention has for the moment saved European civilization. The merit that Fascism has thereby won for itself will live on eternally in history.

Friedrich von Hayek, who was, along with von Mises, one of the patron saints of modern libertarianism, was as infatuated with the Chilean dictator Gen. Augusto Pinochet as von Mises was with Mussolini, according to Greg Grandin:

Friedrich von Hayek, the Austrian émigré and University of Chicago professor whose 1944 Road to Serfdom dared to suggest that state planning would produce not "freedom and prosperity" but "bondage and misery," visited Pinochet’s Chile a number of times. He was so impressed that he held a meeting of his famed Société Mont Pélérin there. He even recommended Chile to Thatcher as a model to complete her free-market revolution. The Prime Minister, at the nadir of Chile’s 1982 financial collapse, agreed that Chile represented a "remarkable success" but believed that Britain’s "democratic institutions and the need for a high degree of consent" make "some of the measures" taken by Pinochet "quite unacceptable."

Like Friedman, Hayek glimpsed in Pinochet the avatar of true freedom, who would rule as a dictator only for a "transitional period," only as long as needed to reverse decades of state regulation. "My personal preference," he told a Chilean interviewer, "leans toward a liberal [i.e. libertarian] dictatorship rather than toward a democratic government devoid of liberalism." In a letter to the London Times he defended the junta, reporting that he had "not been able to find a single person even in much maligned Chile who did not agree that personal freedom was much greater under Pinochet than it had been under Allende." Of course, the thousands executed and tens of thousands tortured by Pinochet’s regime weren’t talking.

The Pinochet dictatorship was admired by the right in the U.S. and Britain for turning Chile’s economic policy over to disciples of Milton Friedman and the University of Chicago, who inflicted disastrous social experiments like the privatization of social security on Chile’s repressed population. Following the libertarian reforms, the Chilean economy collapsed in 1982, forcing the nationalization of the banking system and government intervention in industry. According to Grandin:

While he was in Chile Friedman gave a speech titled "The Fragility of Freedom" where he described the "role in the destruction of a free society that was played by the emergence of the welfare state." Chile’s present difficulties, he argued, "were due almost entirely to the forty-year trend toward collectivism, socialism and the welfare state . . . a course that would lead to coercion rather than freedom."

Friedman politely neglected to mention the lack of political and civil liberty under the Pinochet regime. Many of its victims were drugged and taken in military airplanes to be dropped over the South Atlantic, with their bellies slit open while they were still alive so that their bodies would not float and be discovered.

One of the members of Pinochet’s cabinet, Jose Piñera, has enjoyed a second career at the leading American libertarian think tank, the Cato Institute, and is credited with having influenced George W. Bush’s failed attempt to partly privatize Social Security in America. The Cato website says:

Distinguished senior fellow José Piñera is co-chairman of Cato's Project on Social Security Choice and Founder and President of the International Center for Pension Reform. Formerly Chile's Secretary of Labor and Social Security, he was the architect of the country's successful reform of its pension system. As Secretary of Labor, Piñera also designed the labor laws that introduced flexibility to the Chilean labor market and, as Secretary of Mining, he was responsible for the constitutional law that established private property rights in Chilean mines.

Piñera, the brother of Chile’s billionaire president Sebastian Piñera, has a personal website in which he claims that he played a major role in the transition to democracy in Chile. Piñera’s portrayal of himself as a champion of democracy is somewhat undercut on the same Web page by several defenses of Pinochet's regime that he includes, including this one by a writer in an Australian magazine:

Indeed, in all 17 years of military rule, the total number of dead and missing -- according to the official Retting Commission -- was 2,279. Were there abuses? Were there real victims? Without the slightest doubt. A war on terror tends to be a dirty war.

Still, in the case of Chile, and contrary to news reports, the number of actual victims was small.

The Cato Institute’s problem with democracy is not limited to its appointment of a former functionary of a mass murderer to direct its retirement policy program. Cato Unbound recently hosted a debate over whether libertarianism is compatible with democracy. Milton Friedman’s grandson Patri concluded that it is not:

Democracy Is Not The Answer

Democracy is the current industry standard political system, but unfortunately it is ill-suited for a libertarian state. It has substantial systemic flaws, which are well-covered elsewhere,[2] and it poses major problems specifically for libertarians:

1) Most people are not by nature libertarians. David Nolan reports that surveys show at most 16% of people have libertarian beliefs. Nolan, the man who founded the Libertarian Party back in 1971, now calls for libertarians to give up on the strategy of electing candidates! …

2) Democracy is rigged against libertarians. Candidates bid for electoral victory partly by selling future political favors to raise funds and votes for their campaigns. Libertarians (and other honest candidates) who will not abuse their office can't sell favors, thus have fewer resources to campaign with, and so have a huge intrinsic disadvantage in an election.

In his recommendations for further reading, Friedman included the Austrian economist Hans-Hermann Hoppe’s book "Democracy: The God That Failed," which appeared in 2001, following the fall of the Berlin Wall, during the greatest wave of global democratization in history. In his Cato Unbound manifesto, Friedman called on his fellow libertarians to give up on the whole idea of the democratic nation-state and join his movement in favor of "seasteading," or the creation of new, microscopic sovereign states on repurposed oil derricks, where people who think that "Atlas Shrugged" is really cool can be in the majority for a change....