Röpke was enthusiastic about NR. He hoped it would promote a market-based economics governed by a communitarian ethos. Röpke was a member of the Mont Pelerin Society, a trans-Atlantic organization dedicated to rehabilitating free market economics following the Great Depression and the Keynesian revolution. One of the society’s leading members was Friedrich Hayek, author of The Road to Serfdom and professor of economics at the University of Chicago where his salary was paid by the Volker Fund. Hayek was sanguine about the compatibility of market economics and organic communities. He had initially been somewhat sympathetic to Russell Kirk’s The Conservative Mind and broadly agreed with Röpke’s communitarian market economics. By 1957, however, Hayek repudiated Kirk and Röpke. At the ten-year anniversary meeting of the Mont Pelerin Society in Switzerland, Hayek addressed the membership as to why he was not a conservative. Today, movement conservatives claim Hayek was distinguishing himself from European-style conservatism rather than American small-government conservatism. In a sense this is true, but in part because Hayek, despite keeping his distance from movement conservatives and National Review, influenced the direction of American conservatism. In context, Hayek was very clearly addressing Kirk and Röpke in a discursive struggle over the direction of the Mont Pelerin Society and market economics in general. Kirk disliked Hayek. He suggested that the dividing line in the Mont Pelerin Society was largely between Christians and “Secularized Jews” who were hostile to religion.

In contrast, in the United States theory-minded conservatives and libertarians sought a basis of agreement. In 1960, fourteen right-leaning professors and writers met at the Morrison Hotel in Chicago for a weekend-long discussion. Key fusionists like Frank Meyer and M. Stanton Evans were present, traditionalists were overrepresented, and Hayek stood in for the libertarian wing. The meeting was a great success for “fusionism.” One traditionalist, Gerhart Niemeyer, a political scientist at Notre Dame and a belligerent anti-communist, reported “surprising” levels of agreement. He felt there was no longer any disagreement over the issue of “laissez-faire” versus a positive view of state power. Encouragingly, all agreed upon the importance of “the good life” and that virtue presupposed freedom. All were concerned about “uncoerced individualism” and agreed that industrialism was “not a technological and institutional but ultimately a moral problem, and that it can be controlled by a morally well-ordered society.” Even Hayek, Niemeyer marveled, admitted the existence of natural law, broadly understood, and the importance of a transcendent—even Christian—order.

At the Chicago meeting, and in the many subsequent formulations of the fusionist credo that came to define American conservatism, the traditionalists effectively accepted the economic and political premises of libertarianism and the free market. They concluded that theirs was a cultural critique to be made on an individual, moral level. In exchange for professions of faith in virtue and transcendent order by Hayek and other libertarians, traditionalist conservatives discarded their potent critique of the operation of the market under the logic that virtue must in every instance be uncoerced. In the fusionist bargain, traditionalists—and later evangelicals and other social conservatives—were to wage cultural wars against “liberalism” while accepting on faith the compatibility of free market capitalism with their vision of the good.

YET JUST six months after the meeting of good feelings, Niemeyer realized the limits of the fusionist framework. In September 1960, ninety right-wing college students, including Niemeyer’s son, met at Buckley’s family home in Sharon, Connecticut to form the organization Young Americans for Freedom (YAF). Several of the those present ultimately became important conservative activists. One of the elder statesmen at Sharon was M. Stanton Evans. Evans attended the Chicago meeting and was drafted to write a statement of principles for YAF. The brief statement paid obeisance to the libertarian, traditionalist, anti-communist and patriotic traditions of the right. It held that “foremost among the transcendent values is the individual’s use of his God-given free will,” that “liberty is indivisible,” and that political freedom is linked existentially to economic freedom. Now widely recognized as a formative document for a generation of conservatives who worked for Barry Goldwater and then Ronald Reagan, Evans intended to synthesize the insights of Kirk, Chambers and Hayek. Both Human Events and National Review published the statement as a “tough-as-nails” summary of conservative principles. Pleasingly for Buckley, the Sharon Statement showed that “conservatism” was “accepted both by Russell Kirk and Frank Meyer as designating their distinct but complementary, even symbiotic positions.”

Niemeyer was distressed. The document drew his differences with libertarians so sharply that he could not associate himself with the group. In response, Niemeyer wrote a long open letter to “young conservatives.” He repudiated the notion that free will is a transcendent value. Like Tucker Carlson, he asked whether there was anything transcendent about drug dealers exercising free will. Niemeyer wedded classical ideas about virtue with his strong Christian faith. He perceived the Sharon Statement’s emphasis on economic freedom as materialist in the extreme and linked it to the Marxist claim that political rights are meaningless without economic rights. Niemeyer questioned the very concept of economic freedom. Philosophically, “freedom, the power of uncompelled decision, is not really at home in the realm of economic activities, which is a realm of necessity.” It is, he argued, a political concept that is muddied when it is brought into the economic sphere.

At bottom, Niemeyer concluded the fusionist conservatism articulated in the Sharon Statement was another incarnation of the liberalism he opposed. Anticipating the critique Deneen makes in Why Liberalism Failed, Niemeyer held that by elevating individual rights, the Sharon Statement deracinated “lesser collectivities.” The Statement led to “the condition of utter unfreedom: the individual standing alone before the state, powerless before the sole possessor of power, normless before the sole creator of norms.” Conservatism needed to be purified of residual liberalism. Niemeyer proposed more theorizing and fewer statements. Burnham agreed that Niemeyer demonstrated the incoherence of the Sharon Statement, but William Buckley and Frank Meyer decided the Statement was a manifesto, not high theory, and declined to publish the letter.

By 1962 Viereck, the first popularizer of postwar conservatism, despaired about the future of the movement. In his view, the New Conservatism had “halfway degenerated into a façade for either plutocratic profiteering or fascist-style thought control nationalism.” Economically, conservatism was totally identified with opposition to labor, the New Deal and regulation, especially following the emergence of Senator Barry Goldwater as its standard bearer.

There are many reasons American conservatism became so strongly pro-market. The pre-existing institutional strength was largely pro-business. The Republican Party, committed to Main Street and Wall Street, had little interest in emulating Toryism (except, perhaps, for Richard Nixon). By contrast, the New Conservatives most critical of capitalism were academics, unenthusiastic about movement building or ideological turf wars and without the resources to wage them. Meanwhile, right-leaning foundations like the Volker Fund were far more interested in financing free market economists than traditionalist historians or political philosophers. This funding ultimately built up pro-market think tanks like the American Enterprise Institute and Heritage Foundation.

Individual personalities also shaped the direction of intellectual conservatism. After the 1950s, Russell Kirk’s star fell dramatically as a spokesman of conservatism while Buckley’s and Goldwater’s rose. Goldwater’s 1960 Conscience of a Conservative and 1964 presidential campaign solidified the association between conservatism and the Republican right. Angus Burgin suggests a similar trajectory within the Mont Pelerin Society, which Röpke exited in 1962.

Subsequently, the Society, which had attempted to transcend classical liberal economics, became increasingly committed to unequivocal free markets. Burgin argues this bullish restatement of neoliberalism was led by second generation of economists exemplified by Milton Friedman—a University of Chicago economist, inveterate committee-joiner and advisor to Goldwater. The Cold War overwhelmingly encouraged the conservative commitment to free market economics. The contrast of communist regimes made the connection between capitalism, freedom and democracy (as well as religion) seem natural to these intellectuals. The Soviet Union loomed large at the end of the slippery slope of regulation and welfarism.

THE DOCTRINES proposed by men like Viereck, Kirk and Niemeyer were themselves open to being put in service of market economics, as fusionism’s longevity shows. The New Conservatives and traditionalists universally insisted on the centrality of property and the Lockean relationship between property and liberty. It was the fourth of Kirk’s canons of conservatism. Viereck called private property a “bulwark” against chaos; Hallowell claimed it was rooted “in the religious and moral nature of man.” Fusionists like Meyer were able to use this basic commitment to individual freedom and private property to slice through objections and make individual choice the basis of fusionist conservatism.

Other aspects of conservatism were also amenable as theoretical tools for promoting capitalism. Conservatives justified hierarchy—a defense of privilege that was easily transformed into a justification of economic elites, CEOs and entrepreneurs rather than European aristocrats. Similarly, conservatives insisted they were realistic rather than utopian observers of the world. This conceit led them to accept inequalities and disruptions caused by free market economics as natural. For all their talk of transcendent order, on economic issues, conservative intellectuals conflated “is” with “ought.” Above all, conservatives shifted morality out of the economic sphere, ignoring structural factors. By treating virtue as a cultural problem, they made it incumbent on individual actors to maintain sober habits while promoting an economic order that relied on constant spending and consumption.