A Hayekian historical look at American Indians

One of the main tools in the GMU economics toolkit is the framework of knowledge vs. ignorance. Friedrich Hayek famously argued that central economic planners simply have no way to acquire the relevant knowledge to solve real-world problems. Time and again this viewpoint has illuminated various economic and other social problems. I don’t see the stream of interesting papers using this technique to run out in my lifetime. And it’s not always narrowly economic. It applies in many broader social science questions.

I don’t believe I’ve yet seen Hayek’s analytical framework adapted to Indians. [Here we’re skipping the nomenclature issues and using “Indian” to mean the pre-Columbian inhabitants of the Western Hemisphere.] There are several issues:

1. There weren’t simply “Indians”. A common Indian identity is a relatively new historical phenomenon. Whatever emotive and political power this identity has now, at the time of the contact and for centuries afterwards there were simply many groups who had their own names for themselves, had different languages and cultures, and who didn’t always consider that they were part of a larger group together. The exact same patterns of cultural interaction happened in the Western Hemisphere before 1492 as happened in the whole rest of the world: peaceful coexistence, trade, violent coexistence, etc. One would hardly march into Europe in 1492 from Mars and start talking about how they were all one group of people. It wouldn’t make sense to them at all except in broad geographical terms. Moreover, even before contact, there were groups migrating, waxing and waning, forming and melding, and some simply going about their business, just like everywhere else in the world.

Indian policy by the Spanish, French, British, American, Mexican et al. governments has always recognized that not all tribes are alike—some were allies and some hostile—but the subtleties always seemed to be outside their grasps. Some existed in settled agricultural communities and some were nomadic, for example, while some were semi-nomadic and some were in flux between patterns. Many of these differences could have been found out by these governments if they had cared to, but many of them couldn’t. They didn’t even know what they didn’t know, and that it was important. Yet they presumed to make broad policies anyway.

2. These authorities gave very little thought to historical development. A culture that has been nomadic for one thousand years is less likely to adapt well to farming than a culture that has been agricultural for 900 years and semi-nomadic for the last hundred. The historical event with the most impact was the spread of Eurasian diseases, which killed off untold numbers of people. The numbers vary on this estimate, but on the higher end something around 90% of human North America may have died between the initial contacts and the settling period. This is a world-historically massive change, yet the initial settlers hardly seem to have taken notice. (Charles C. Mann’s 1491 makes the analogy of a visitor to central Europe first arriving in the immediate aftermath of World War II and assuming that the people had always lived in filth, digging through ruins for edible scraps.)

3. The authorities also gave little thought to different cultural norms. We’ve all heard the story about a European buying Manhattan from the Indians living there, who didn’t think that anybody had title to land or could transfer it. This is huge, and probably for that reason has already been covered more than the other points. If one cannot own land, one cannot sell it or buy it. Even if one can own land, the people who live on it have infinitely better claims than the chief in Washington who simply claimed it belonged to the US. Many people dealing with Indians probably knew at least to some small degree that treaties did not count among (many) Indians as proper ways to transfer property, but did it anyway.

4. Some policy makers may have had good intentions regarding Indians, but they were at cross purposes with the intentions of the Indians themselves. Culture is not monolithic. People adapt themselves to new events, ideas, and material goods all the time. The most consistent policy was to try to turn Indians into farmers on small family plots. This would, over time, make them like the newer arrivals culturally and integrate them into America’s agricultural society. Many people who subscribed to this proposal genuinely thought this would be the best thing for them.

The problem, of course, is that nobody consulted the Indians about it. Some of them wanted to adapt to the new arrivals’ ways out of expedience, but some just wanted to keep doing what they had been doing without interference. The various Indian agents from the Bureau of Indian Affairs frequently did not care about their charges one way or another, but even the ones that did could hardly understand the magnitude of their tasks. It’s simply not possible to remold societies like that, and even piecemeal takes so much knowledge of local cultural attitudes that they could hardly be expected to learn them during the length of an assignment. Compounding the difficult is that different (Indian) people wanted to do different things with their lives. The effort was doomed from the start.

In retrospect, it seems ridiculous on top of being cruel. Take the land from other cultures, and then take over their cultures too. Don’t ask them what they want or what’s realistic (and certainly not just) as a policy, don’t be sensitive to failures of the policy, and don’t be flexible when nobody can deny any longer that the policies were destructive and wrong.

The courts were not much help either. At first they failed to recognize what in retrospect was obvious: the policies were completely unjust. They also failed to recognize what was not so obvious: the policies were characterized by ignorance of how Indian cultures functioned, and as such could not have worked. This has somewhat changed since the 1970s. The courts have started realizing the injustice of past Indian policy and attempted, somewhat, to correct what they could. Unintentionally, they have recognized the government’s ignorance by recognizing that the policies were utter failures.


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