The Foundations of Morality is Henry Hazlitt's attempt to build a secular ethics from two fields he thought moral philosophers had neglected: economics, which explains how people with different values cooperate, and jurisprudence, with its experience of general rules. His system, which he names Cooperatism and classifies as a rule-utilitism, judges conduct by the foreseeable consequences of general rules. It favors the rules that sustain voluntary social cooperation, through which each person pursues nearly all of his own ends. The book suits readers who want one consequentialist test for moral rules, law and market exchange, and it defends that test without claiming that economics alone proves moral conclusions. This review uses the 1994 FEE Hazlitt Centennial edition, which reprints the 1964 text with the 1963 and 1972 prefaces (PDF at the Mises Institute). It draws on the contents, both prefaces and selected passages through the conclusion.
The argument starts from disagreement. No two people find satisfaction in the same things, and Hazlitt expects no unanimity in value judgments. Social cooperation needs none. The division of labor raises each participant's productivity, and exchange lets each person further others' purposes as an indirect means of furthering his own. Following Philip Wicksteed, he notes that a mother hunting for the lowest grocery price may be shopping for her children's tastes. Exchange shows whose purposes direct each side of a transaction and leaves open whether those purposes are selfish. The 1972 preface withdraws any suggestion that people do or should act from exclusively egocentric motives.
From there Hazlitt turns to rules, crediting Hume with judging general rules of action by their consequences. Nobody can know all the effects of an isolated act, he argues, while experience reveals the probable effects of following an accepted rule, including its effects as precedent and example. Traffic supplies his analogy. Which side of the road to keep to was initially an arbitrary choice. Once the rule is known, two drivers meeting on a narrow road can each predict where the other will pass, and traffic moves faster and more safely. Exceptions must be general too: a fire engine may pass a red light under specified conditions, while an official's rank confers no exemption. Hazlitt puts the burden of proof on whoever would break or change an established rule and expects moral codes to improve as languages do, through piecemeal reform.
Law occupies a smaller territory within the same field. Hazlitt borrows Bentham's image of law as a circle with the same center as moral philosophy and a smaller circumference. Because law acts through sanctions and needs proof, it reaches outward conduct and leaves wider duties of benevolence to conscience. Following Hayek, he holds that the state must have a monopoly of coercion, exercised under known general laws, if coercion between persons is to be minimized.
The same criterion then tests economic institutions. Secure property lets a producer keep what his labor yields, and nobody, Hazlitt argues, would build a house that anyone could seize. In his account, owners of productive capital must serve consumers or suffer losses, since consumers' purchases decide each day who holds that capital. Competition under good laws and morals becomes triangular cooperation: General Motors and Ford each court the car buyer, and each pushes the other to cut costs and improve its cars. Hazlitt concedes that isolated injustices occur and judges institutions by their effects in most cases. Freedom and cooperation meet here, because exchange among people with different ends depends on property rules each can rely on.
Readers looking for an anarchist theory or for unconditional rights will find Hazlitt endorsing a state monopoly of coercion. The harder question is sacrifice, and Hazlitt confronts it directly. In his chapter on self-sacrifice he asks whether some sacrifices bring no compensating gain even in the long run, concedes that a rule may cost a person his own long-run interest, and requires compliance anyway: keeping such responsibilities serves the long-run interest of all, and admitted exceptions would erode the rules themselves. He later describes the moral code as a tacit, unformulated but real agreement, so that individual violations imperil general adherence. The 1972 preface adds no new argument; Hazlitt says he would stress those same pages even more strongly and treat the rules as inviolate. This is a rule-utilitarian argument judged on general practice. It is neither a tally of utility act by act nor a deduction from natural rights. Following Hayek, Hazlitt holds that a rule must be justified as a whole, not in each application, so readers should judge whether the rule as a whole is justified.
Read it for the question of how people who want different things can share binding moral rules. Expect an argument that reaches ethics from economics and law, through analogy and reasoning about long-run consequences, in steady conversation with Hume, Bentham, Sidgwick and Hayek.