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3.75 AVERAGE
3.75 AVERAGE
challenging
informative
reflective
slow-paced
This book has taken me a substantial amount of time to read. Hayek composed a very dense book, a lot of which I disagreed with, and still now that it is over it feels like a very important read. When I started this book I thought the author was making vile points, and admittedly I had a strong reaction. I told co-workers the author was crazy and that the information inside was nonsensical. Here I formally apologize for that. About 60% of the way through the book I realized what Hayek had truly done. After laying out a bunch of things which I disagreed with he started to pick apart the things I did believe and demonstrating how they actually tied into things I disliked. While I don’t think he nailed the landing every time he nailed it enough that I must applaud him. This book was not fun, it was not gripping, and it was not lighthearted. It was important.
Given Hayek’s reputation as an economist, I was expecting that The Road to Serfdom would delve into the economic arguments against socialism, but instead it outlines the moral and political arguments. This was something of a disappointment to me as a former economics major who picked up this book in the hope of exposing myself to the economic theories of the Austrian school (theories that are generally given short shrift in most American economics departments). As a work of political science, however, the book is valuable and influential.
Granted, Hayek’s points of opposition to socialism seem almost obvious to me now in the 21st century, but he was among the first (in the 1940’s) to point out that fascism was not in fact at the opposite end of the political pole from communism, but rather an outgrowth of the same tendency toward central planning. He even describes how anti-Semitism (obvious in fascism but also quite predominant in communism) and anti-capitalism have comingled roots. He offers a kind of history of socialism, particularly with regard to its development in Germany, and a logical argument that its inevitable trajectory is some form of totalitarianism. Finally, he warns England (with occasional reference to America) against following the path of collectivism to the dead end of dictatorship.
Scarcity is the unavoidable economic problem, and, consequently, in any system, there are tradeoffs. Socialists would like to believe this were not so. “That people should wish to be relieved of the bitter choice which hard facts often impose upon them is not surprising. But few want to be relieved through having the choice made for them. People just wish that the choice should not be necessary at all. And they are only too ready to believe that the choice is not really necessary, that is imposed upon them merely by the particular economic system under which we live.” So they oppose capitalism and seek a system they hope will create the mythical state of wealth equality and abundance. Hayek does not say that capitalism is perfect, or that it does not have its flaws; what he says is that inequity is inevitable, and that we do better to have “individual shares” determined by a combination of “the ability and enterprise of the people concerned” and random chance (the capitalist system) than by “a system where it is the will of a few persons that decides who is to get what” (the socialist system).
As socialism progresses, “it becomes more and more evident to everyone that his income and general position are determined by the coercive apparatus of the state, that he can maintain or improve his position only as a member of an organized group capable of influencing or controlling the state machine in his interest.” This may give us some insight into why, as the U.S. government grows to at least partially control more and more industries through subsidies, bailouts, protectionism, regulation, and unequal taxation, lobbyists and “special interests” become more and more plentiful and powerful. Take government intervention in economics still farther, as “in a planned society,” and “the question can no longer” simply be “on what do a majority of the people agree”? Rather, the question becomes, what is the largest “single group whose members agree sufficiently to make unified direction of all affairs possible”? This is why collectivism will, in the end, ultimately only be operated in the interest of a specific group (such as a party) and not in the interest of the majority. And, unfortunately, “such a numerous and strong group with fairly homogenous views is not likely to be formed by the best but rather by the worst elements of society.” (He goes on to explain three reasons why, and this is one of the most politically insightful portions of the book.)
Socialists seek “to secure a distribution of wealth which conforms to some predetermined standard,” but “the price we should have to pay for the realization of somebody’s ideal of justice” may well be “more discontent and more oppression than was ever caused by the much-abused free play of economic forces.” First off, there must be inequality before the law in any socialist system, for “equality before the law is in conflict, and in fact incompatible, with any activity of the government deliberately aiming at material or substantive equality of different people.” Following a logically trajectory, Hayek concludes that only within “a competitive system based on free disposal over private property…is democracy possible. When it becomes dominated by a collectivist creed, democracy will inevitably destroy itself.” Planning inevitably “leads to dictatorship because dictatorship is the most effective instrument of coercion and the enforcement of ideals and, as such, essential if central planning on a large scale is to be possible. The clash between planning and democracy arises simply from the fact that the latter is an obstacle to the suppression of freedom which the direction of economic activity requires.”
Democracy as a “guaranty of individual freedom” will be destroyed, that is, for democracy CAN exist in some form in a totalitarian state. Even if “power is conferred by democratic procedure,” it can “be arbitrary….it is not the source but the limitation of power which prevents it from being arbitrary. Democratic control may prevent power from becoming arbitrary, but it does not do so by its mere existence. If democracy resolves on a task which necessarily involves the use of power which cannot be guided by fixed rules, it must become arbitrary power.” So beware, those of you who think living in a democracy will prevent you from slipping into tyranny. Hayek concedes that an English or American fascism would probably attract a better quality of dictator than say, a German or Italian fascism, but nevertheless, “the worst features of the existing totalitarian systems” are probably “not accidental by-products but phenomena which totalitarianism” in any culture “is certain sooner or later to produce.” Socialism, he argues, also by necessity becomes nationalistic.
None of this is to say that socialists originally intend tyranny. Indeed, “in the democracies,” writes Hayek, “the majority of people still believe that socialism and freedom can be combined. There can be no doubt that most socialists here still believe profoundly in the liberal ideal of freedom and that they would recoil if they became convinced that the realization of their program would mean the destruction of freedom.” It is important, however, to consider not the “moral basis” for socialism “but its moral results.”
Though Hayek is much admired by libertarians, his positions here are not necessarily libertarian. He does not insist on an extreme lack of government involvement; rather, he opposes only that government involvement that works against competition. While he would almost certainly oppose price controls and subsidies, and while he would support privatization of airlines, railways, and utilities, he appears to be in favor of some form of welfare (i.e. “assist[ing] the poorer people as much as we can in their own efforts to build up their lives and raise their standards of living”), certain government regulations of businesses that do not thwart competition, some form of “international authority” (“if it merely keeps order and creates conditions in which the people can develop their own life”), and some form of “social insurance” (though by that he means something really like catastrophic insurance and not at all like the pyramid scheme we in the U.S. call social security). That is to say, he goes much farther than any modern-day American liberal in supporting individual liberty and opposing government intervention, but no so far as the libertarian. To me, here at least, he comes off as a classical liberal.
The Road to Serfdom was sometimes dull and difficult to read. While it helps to explain how fascism developed in Germany, it is in many ways out of date today. Nevertheless, it does offer some insights into how recent trends toward socialism in the United States (among both Democrats and Republicans) have created, are creating, and will create restrictions on individual liberty. The book could certainly have been more engaging, but it did ultimately solidify my conviction that, intentions aside, tyranny and injustice—as well as nationalism and war –are the likely long-term results of socialism. As Hillarie Belloc said, “The control of the production of wealth is the control of human life itself.”
Granted, Hayek’s points of opposition to socialism seem almost obvious to me now in the 21st century, but he was among the first (in the 1940’s) to point out that fascism was not in fact at the opposite end of the political pole from communism, but rather an outgrowth of the same tendency toward central planning. He even describes how anti-Semitism (obvious in fascism but also quite predominant in communism) and anti-capitalism have comingled roots. He offers a kind of history of socialism, particularly with regard to its development in Germany, and a logical argument that its inevitable trajectory is some form of totalitarianism. Finally, he warns England (with occasional reference to America) against following the path of collectivism to the dead end of dictatorship.
Scarcity is the unavoidable economic problem, and, consequently, in any system, there are tradeoffs. Socialists would like to believe this were not so. “That people should wish to be relieved of the bitter choice which hard facts often impose upon them is not surprising. But few want to be relieved through having the choice made for them. People just wish that the choice should not be necessary at all. And they are only too ready to believe that the choice is not really necessary, that is imposed upon them merely by the particular economic system under which we live.” So they oppose capitalism and seek a system they hope will create the mythical state of wealth equality and abundance. Hayek does not say that capitalism is perfect, or that it does not have its flaws; what he says is that inequity is inevitable, and that we do better to have “individual shares” determined by a combination of “the ability and enterprise of the people concerned” and random chance (the capitalist system) than by “a system where it is the will of a few persons that decides who is to get what” (the socialist system).
As socialism progresses, “it becomes more and more evident to everyone that his income and general position are determined by the coercive apparatus of the state, that he can maintain or improve his position only as a member of an organized group capable of influencing or controlling the state machine in his interest.” This may give us some insight into why, as the U.S. government grows to at least partially control more and more industries through subsidies, bailouts, protectionism, regulation, and unequal taxation, lobbyists and “special interests” become more and more plentiful and powerful. Take government intervention in economics still farther, as “in a planned society,” and “the question can no longer” simply be “on what do a majority of the people agree”? Rather, the question becomes, what is the largest “single group whose members agree sufficiently to make unified direction of all affairs possible”? This is why collectivism will, in the end, ultimately only be operated in the interest of a specific group (such as a party) and not in the interest of the majority. And, unfortunately, “such a numerous and strong group with fairly homogenous views is not likely to be formed by the best but rather by the worst elements of society.” (He goes on to explain three reasons why, and this is one of the most politically insightful portions of the book.)
Socialists seek “to secure a distribution of wealth which conforms to some predetermined standard,” but “the price we should have to pay for the realization of somebody’s ideal of justice” may well be “more discontent and more oppression than was ever caused by the much-abused free play of economic forces.” First off, there must be inequality before the law in any socialist system, for “equality before the law is in conflict, and in fact incompatible, with any activity of the government deliberately aiming at material or substantive equality of different people.” Following a logically trajectory, Hayek concludes that only within “a competitive system based on free disposal over private property…is democracy possible. When it becomes dominated by a collectivist creed, democracy will inevitably destroy itself.” Planning inevitably “leads to dictatorship because dictatorship is the most effective instrument of coercion and the enforcement of ideals and, as such, essential if central planning on a large scale is to be possible. The clash between planning and democracy arises simply from the fact that the latter is an obstacle to the suppression of freedom which the direction of economic activity requires.”
Democracy as a “guaranty of individual freedom” will be destroyed, that is, for democracy CAN exist in some form in a totalitarian state. Even if “power is conferred by democratic procedure,” it can “be arbitrary….it is not the source but the limitation of power which prevents it from being arbitrary. Democratic control may prevent power from becoming arbitrary, but it does not do so by its mere existence. If democracy resolves on a task which necessarily involves the use of power which cannot be guided by fixed rules, it must become arbitrary power.” So beware, those of you who think living in a democracy will prevent you from slipping into tyranny. Hayek concedes that an English or American fascism would probably attract a better quality of dictator than say, a German or Italian fascism, but nevertheless, “the worst features of the existing totalitarian systems” are probably “not accidental by-products but phenomena which totalitarianism” in any culture “is certain sooner or later to produce.” Socialism, he argues, also by necessity becomes nationalistic.
None of this is to say that socialists originally intend tyranny. Indeed, “in the democracies,” writes Hayek, “the majority of people still believe that socialism and freedom can be combined. There can be no doubt that most socialists here still believe profoundly in the liberal ideal of freedom and that they would recoil if they became convinced that the realization of their program would mean the destruction of freedom.” It is important, however, to consider not the “moral basis” for socialism “but its moral results.”
Though Hayek is much admired by libertarians, his positions here are not necessarily libertarian. He does not insist on an extreme lack of government involvement; rather, he opposes only that government involvement that works against competition. While he would almost certainly oppose price controls and subsidies, and while he would support privatization of airlines, railways, and utilities, he appears to be in favor of some form of welfare (i.e. “assist[ing] the poorer people as much as we can in their own efforts to build up their lives and raise their standards of living”), certain government regulations of businesses that do not thwart competition, some form of “international authority” (“if it merely keeps order and creates conditions in which the people can develop their own life”), and some form of “social insurance” (though by that he means something really like catastrophic insurance and not at all like the pyramid scheme we in the U.S. call social security). That is to say, he goes much farther than any modern-day American liberal in supporting individual liberty and opposing government intervention, but no so far as the libertarian. To me, here at least, he comes off as a classical liberal.
The Road to Serfdom was sometimes dull and difficult to read. While it helps to explain how fascism developed in Germany, it is in many ways out of date today. Nevertheless, it does offer some insights into how recent trends toward socialism in the United States (among both Democrats and Republicans) have created, are creating, and will create restrictions on individual liberty. The book could certainly have been more engaging, but it did ultimately solidify my conviction that, intentions aside, tyranny and injustice—as well as nationalism and war –are the likely long-term results of socialism. As Hillarie Belloc said, “The control of the production of wealth is the control of human life itself.”
informative
reflective
medium-paced
I have been meaning to read Hayek's economic classic for many years. I could certainly rate it a 5 but it's not an easy book to read. Written in 1944, Hayek seeks to explain that the economic socialism that the Europeans seem to be so enamored with is the same socialism that preceded the totalitarian regimes in Germany and Italy. This book is timeless. I plan to review it further on my blog - not enough room here!
informative
medium-paced
This book was terribly underwhelming. I expected a creative new approach to macroeconomics, and yet the first half of the book is spent equating Fascism with Communism (what?), and arguing that anyone who doesn't support unfettered laissez faire is essentially preparing to murder Jews.
Overly academic tone (which was perhaps the style at that time) made it not a real page turner. But overall I really enjoyed it. He makes it all seem so obvious when he makes his critiques of socialism. But when I talk to about these points to a socialist, they didn’t realize this stuff, and they never thought about it that way.
For example, socialists often assume that the state should be run in a way that enforces rules about not exploiting workers and not allowing racism. That requires a lot of “power”. And what kind of people end up typically acquiring roles that have a lot of power? It’s not people like you. It’s narcissists and sociopaths, naturally; just look at the past 2000 years or so. Sure, there are exceptions. And typically when these people get all that power it’s not ending worker exploitation that gets them out of bed in the morning. It’s their own ego. So the benefit of capitalism is that it relegates these egomaniacs to set their sights on building electric cars, or functioning within a limited congress, or making feature films, etc. Does it create a perfect egalitarian economy? In many senses it leaves a lot to be desired. But look at where we came from, before capitalism; the divides in society used to be a lot worse. And the societies that have “progressed” the most have often been the most capitalist ones. There are exceptions. But do we really want to hand over responsibility for choosing what’s best for us to someone who only ostensibly has our interests at heart, but in reality is a flawed corruptible human being? I’d say no. And this book also spends a lot of time pointing out from direct experience of the propaganda machine, the direct connection between that Marxist line reasoning and the rise of the Nazi state. Conveniently most socialists I know choose not to believe that connection, and I don’t blame them, because it would be too embarrassing to admit it.
Another interesting point was about how the heck would “planning the economy” work on a practical level? How can someone else tell you what to do when they don’t know you and what you’re actually good at? How can someone dictate the prices of bread when they don’t know how much grain is available for sale? How can they take in all the numbers and construct all the formulas for setting everything up in a balanced way? And how could we all agree on what a balanced formulas outcome would be? It all would easily devolve into a corrupted power-grab. Maybe we should just let people decide on their own careers and set the prices of the goods that they sell, and consumers can make their own purchasing decisions about whether the price is worth it or not.
For example, socialists often assume that the state should be run in a way that enforces rules about not exploiting workers and not allowing racism. That requires a lot of “power”. And what kind of people end up typically acquiring roles that have a lot of power? It’s not people like you. It’s narcissists and sociopaths, naturally; just look at the past 2000 years or so. Sure, there are exceptions. And typically when these people get all that power it’s not ending worker exploitation that gets them out of bed in the morning. It’s their own ego. So the benefit of capitalism is that it relegates these egomaniacs to set their sights on building electric cars, or functioning within a limited congress, or making feature films, etc. Does it create a perfect egalitarian economy? In many senses it leaves a lot to be desired. But look at where we came from, before capitalism; the divides in society used to be a lot worse. And the societies that have “progressed” the most have often been the most capitalist ones. There are exceptions. But do we really want to hand over responsibility for choosing what’s best for us to someone who only ostensibly has our interests at heart, but in reality is a flawed corruptible human being? I’d say no. And this book also spends a lot of time pointing out from direct experience of the propaganda machine, the direct connection between that Marxist line reasoning and the rise of the Nazi state. Conveniently most socialists I know choose not to believe that connection, and I don’t blame them, because it would be too embarrassing to admit it.
Another interesting point was about how the heck would “planning the economy” work on a practical level? How can someone else tell you what to do when they don’t know you and what you’re actually good at? How can someone dictate the prices of bread when they don’t know how much grain is available for sale? How can they take in all the numbers and construct all the formulas for setting everything up in a balanced way? And how could we all agree on what a balanced formulas outcome would be? It all would easily devolve into a corrupted power-grab. Maybe we should just let people decide on their own careers and set the prices of the goods that they sell, and consumers can make their own purchasing decisions about whether the price is worth it or not.
medium-paced
Some points about government necessity (i.e. regulation) with which I agree, but no interrogation of the value of competition, just an assumption/assertion that it is good and somehow integral to individual freedom. Lots of inconsistent thinking, just a love for the necessary hardships of the free market.
challenging
informative
reflective
medium-paced
Compelling, interesting, and a worthwhile read, even for those who won't hitch a wagon to Hayek's brand of economic conservatism.