Thomas Nagel opposes attempts to "reduce" consciousness and mental actions to physical explanations. Like Peter Strawson, he is concerned about "objective" accounts of mind that try to view a mind externally. He holds that the internal or subjective view contains an irreducible element without which we lose the autonomous agent.
I think the only solution is to regard action as a basic mental or more accurately psychophysical category — reducible neither to physical nor to other mental terms. Action has its own irreducibly internal aspect as do other psychological phenomena — there is a characteristic mental asymmetry between awareness of one's own actions and awareness of the actions of others — but action isn't anything else, alone or in combination with a physical movement: not a sensation, not a feeling, not a belief, not an intention or desire. If we restrict our palette to such things plus physical events, agency will be omitted from our picture of the world. But even if we add it as an irreducible feature, making subjects of experience also subjects of action, the problem of free action remains. We may act without being free, and we may doubt the freedom of others without doubting that they act. What undermines the sense of freedom doesn't automatically undermine agency.
Nagel discusses the problem of free will only indirectly, in the context of autonomy and responsibility, given the hypothesis of determinism.
What I shall discuss are two aspects of the problem of free will, corresponding to the two ways in which objectivity threatens ordinary assumptions about human freedom. I call one the problem of autonomy and the other the problem of responsibility; the first presents itself initially as a problem about our own freedom and the second as a problem about the freedom of others. An objective view of actions as events in the natural order (determined or not) produces a sense of impotence and futility with respect to what we do ourselves. It also undermines certain basic attitudes toward all agents—those reactive attitudes (see Strawson (Freedom and Resentment)) that are conditional on the attribution of responsibility. It is the second of these effects that is usually referred to as the problem of free will. But the threat to our conception of our own actions — the sense that we are being carried along by the universe like small pieces of flotsam — is equally important and equally deserving of the title. The two are connected. The same external view that poses a threat to my own autonomy also threatens my sense of the autonomy of others, and this in turn makes them come to seem inappropriate objects of admiration and contempt, resentment and gratitude, blame and praise. Like other basic philosophical problems, the problem of free will is not in the first instance verbal. It is not a problem about what we are to say about action, responsibility, what someone could or could not have done, and so forth. It is rather a bafflement of our feelings and attitudes — a loss of confidence, conviction or equilibrium. Just as the basic problem of epistemology is not whether we can be said to know things, but lies rather in the loss of belief and the invasion of doubt, so the problem of free will lies in the erosion of interpersonal attitudes and of the sense of autonomy. Questions about what we are to say about action and responsibility merely attempt after the fact to express those feelings — feelings of impotence, of imbalance, and of affective detachment from other people. These forms of unease are familiar once we have encountered the problem of free will through the hypothesis of determinism. We are undermined but at the same time ambivalent, because the unstrung attitudes don't disappear: they keep forcing themselves into consciousness despite their loss of support. A philosophical treatment of the problem must deal with such disturbances of the spirit, and not just with their verbal expression. I change my mind about the problem of free will every time I think about it, and therefore cannot offer any view with even moderate confidence; but my present opinion is that nothing that might be a solution has yet been described. This is not a case where there are several possible candidate solutions and we don't know which is correct. It is a case where nothing believable has (to my knowledge) been proposed by anyone in the extensive public discussion of the subject. The difficulty, as I shall try to explain, is that while we can easily evoke disturbing effects by taking up an external view of our own actions and the actions of others, it is impossible to give a coherent account of the internal view of action which is under threat. When we try to explain what we believe which seems to be undermined by a conception of actions as events in the world — determined or not — we end up with something that is either incomprehensible or clearly inadequate. This naturally suggests that the threat is unreal, and that an account of freedom can be given which is compatible with the objective view, and perhaps even with determinism. But I believe this is not the case. All such accounts fail to allay the feeling that, looked at from far enough outside, agents are helpless and not responsible. Compatibilist accounts of freedom tend to be even less plausible than libertarian ones. Nor is it possible simply to dissolve our unanalyzed sense of autonomy and responsibility. It is something we can't get rid of, either in relation to ourselves or in relation to others. We are apparently condemned to want something impossible.
Even as he sees efforts to explain the mind "impossible, incomprehensible, or clearly inadequate", Nagel offers us an excellent criticism of past attempts by philosophers to limit our investigations by claiming they are impossible. His view that problems are "intractable" seems similar to Colin McGinn's "mysterianism."
The history of the subject is a continual discovery of problems that baffle existing concepts and existing methods of solution. At every point it faces us with the question of how far beyond the relative safety of our present language we can afford to go without risking complete loss of touch with reality. We are in a sense trying to climb outside of our own minds, an effort that some would regard as insane and that I regard as philosophically fundamental. Historicist interpretation doesn't make philosophical problems go away, any more than the earlier diagnoses of the logical positivists or the linguistic analysts did. To the extent that such no-nonsense theories have an effect, they merely threaten to impoverish the intellectual landscape for a while by inhibiting the serious expression of certain questions. In the name of liberation, these movements have offered us intellectual repression. But that leaves a question. If the theories of historical captivity or grammatical delusion are not true, why have some philosophers felt themselves cured of their metaphysical problems by these forms of therapy? My counterdiagnosis is that a lot of philosophers are sick of the subject and glad to be rid of its problems. Most of us find it hopeless some of the time, but some react to its intractability by welcoming the suggestion that the enterprise is misconceived and the problems unreal. This makes them receptive not only to scientism but to deflationary metaphilosophical theories like positivism and pragmatism, which offer to raise us above the old battles.
In his essay "Moral Luck," Nagel is pessimistic about finding morally responsible agents in a world that views agents exteranlly, reducing them to happenings, to sequences of events, following natural laws, whether deterministic or indeterministic. Free will and moral responsibility seem to be mere illusions.
Moral judgment of a person is judgment not of what happens to him, but of him. It does not say merely that a certain event or state of affairs is fortunate or unfortunate or even terrible. It is not an evaluation of a state of the world, or of an individual as part of the world. We are not thinking just that it would be better if he were different, or did not exist,. or had not done some of the things he has done. We are judging him, rather than his existence or characteristics. The effect of concentrating on the influence of what is not under his control is to make this responsible self seem to disappear, swallowed up by the order of mere events. What, however, do we have in mind that a person, must be to be the object of these moral attitudes? While the concept of agency is easily undermined, it is very difficult to give it a positive characterization. That is familiar from the literature on Free Will. I believe that in a sense the problem has no solution, because something in the idea of agency is incompatible with actions being events, or people being things. But as the external determinants of what someone has done are gradually exposed, in their effect on consequences, character, and choice itself, it becomes gradually clear that actions are events and people things. Eventually nothing remains which can be ascribed to the responsible self, and we are left with nothing but a portion of the larger sequence of events, which can be deplored or celebrated, but not blamed or praised. Though I cannot define the idea of the active self that is thus undermined, it is possible to say something about its sources. There is a close connexion between our feelings about ourselves and our feelings about others. Guilt and indignation, shame and contempt, pride and admiration are internal and external sides of the same moral attitudes. We are unable to view ourselves simply as portions of the world, and from inside we have a rough idea of the boundary between what is us and what is not, what we do and what happens to us, what is our personality and what is an accidental handicap. We apply the same essentially internal conception of the self to others. About ourselves we feel pride, shame, guilt, remorse - and agent-regret. We do not regard our actions and our characters merely as fortunate or unfortunate episodes - though they may also be that. We cannot simply take an external evaluative view of ourselves - of what we most essentially are and what we do. And this remains true even when we have seen that we are not responsible for our own existence, or our nature, or the choices we have to make, or the circumstances that give our acts the consequences they have. Those acts remain ours and we remain ourselves, despite the persuasiveness of the reasons that seem to argue us out of existence. It is this internal view that we extend to others in moral judgment - when we judge them rather than their desirability or utility. We extend to others the refusal to limit ourselves to external evaluation, and we accord to them selves like our own. But in both cases this comes up against the brutal inclusion of humans and everything about them in a world from which they cannot be separated and of which they are nothing but contents. The external view forces itself on us at the same time that we resist it. One way this occurs is through the gradual erosion of what we do by the subtraction of what happens. The inclusion of consequences in the conception of what we have done is an acknowledgment that we are parts of the world, but the paradoxical character of moral luck which emerges from this acknowledgment shows that we are unable to operate with such a view, for it leaves us with no one to be.The same thing is revealed in the appearance that determinism obliterates responsibility. Once we see an aspect of what we or someone else does as something that happens, we lose our grip on the idea that it has been done and that we can judge the doer and not just the happening. This explains why the absence of determinism is no more hospitable to the concept of agency than is its presence — a point that has been noticed often. Either way the act is viewed externally, as part of the course of events.The problem of moral luck cannot be understood without an account of the internal conception of agency and its special connection with the moral attitudes as opposed to other types of value. I do not have such an account. The degree to which the problem has a solution can be 'determined only by seeing whether in some degree the incompatibility between this conception and the various ways in which we do not control what we do is only apparent. I have nothing to offer on that topic either. But it is not enough to say merely that our basic moral attitudes toward ourselves and others are determined by what is actual; for they are also threatened by the sources of that actuality, and by the external view of action which forces itself on us when we see how everything we do belongs to a world that we have not created.