Saturday, January 16, 2010

The Road to Serfdom



The Road to Serfdom: Text and Documents--The Definitive Edition (The Collected Works of F. A. Hayek)

Reading The Road to Serfdom by Fredrich A. Hayek was an eye opening experience for me. Amazingly this is a short book, just a political pamphlet.  It was written in 1944 aimed at the political controversies of the years following the Second World War. I do not get the feeling that Hayek wrote it this book as a tomb for the ages; I think he was only writing it for the next few political cycles. He talks about the views of specific political leaders and academics and he refers to specific feelings and sentiments which only existed in the wake of World War II. Nevertheless this book is applicable today. When I read it, every other page I would see a quote which I thought I should write down and use in this review. Luckily, I was not near my computer while reading this otherwise I might have transcribed half of the book. I ended up chosing not to include any quotes in this review so that I could focus on the overall message.

The Road to Serfdom was written for Great Britain after the Second World War. Great Britain was deciding what its policy should be after the war during the reconstruction period. Both the elites and the general public were pushing for more central planning and trying to decide how to structure the world for growth and prosperity following the war. Hayek, an Austrian, understood the German personality and the history of German thought leading up to World War II. He had moved moved from his native land to join the London School of Economics in 1931 and thus avoided being in occupied Europe during the war. As Hayek followed British discourse and thought after the war, he realized that the British train of thinking was following the same path as German thought and sought to warn the British.

The main point which Hayek tries to get across is that you cannot have central planning and freedom. The two cannot are mutually exclusive. If you decide to direct a nation on a course, you cannot allow people to do as they choose. People must do what the state tells them and not what they feel is best. For central planning to work you must have a dictator because a democracy cannot get agreement on the very specific directions and goals required for planning an economy. Also laws must become arbitrary in order for central planners to direct society. A law that has a fixed meaning allows individuals to pursue their own agendas if they can figure out ways to avoid actions proscribed by the law. To direct society, a direction must be chosen and the planner must constantly change the meaning of the law to shepherd "his" people from wandering off in pursuit of their own dreams and goals.

Hayek does not say that this is a new trend for Britain. He says Britain had been traveling this path for some time but at a much slower pace than Germany. Furthermore, Britains before the turn of the century would have been shocked by how little liberty the populace had: the 1950s we dream about today were actually tyranical compared to its past.

Hayek places struggle as a battle between German and Anglo-Saxon thought. Anglo-Saxon thought spread outward and eastward until 1870. For much of Western Civilization liberty had been expanding, but in 1870 (Hayek does not say why this year) the tide turned and German thought based on collectivism began to push back the concepts of liberalism and freedom.

There are a number of interesting anecdotes which Hayek discusses in the book. I will only cover a couple here. We all know how Nazi Germans hated the Jews, but we attribute it to some vague propaganda put out by Hitler. Hayek gives a more reasonable explaination. The Jews were already outsiders and at the bottom of German society. As centralization advanced and the government positions became more prestigious in Germany.  More and more Germans began working for the State or in centralized state aided monopolies:  in these positions they had prestige, stability, and fixed wages. The Jews were pushed into the most despised jobs in the economy (entrepreneuring) because they could not get the cushy government jobs. Since they operated in a more free-market sector of the economy than the the Germans many of them ended up becoming wealthy. The Germans already hated businessmen and the fact that the outsiders were becoming wealthy at this hated profession made them hate the Jews even more.

Another interesting aspect of the book is that Hayek is not an anarchist and envisions a role for Government in society. He might be considered a statist by libertarians today as he conceeds many points that no self respecting libertarian would dream of letting slide. This is a sign of libertarianism's intellectual development over the past 60 years.

In closing, this is a short readable book that will open your eyes to the dangers of central planning and the havock it can visit upon society. It will open your eyes to warning signs that you had seen before. The arguments Hayek makes are very concise and convincing.