The Road to Serfdom: Text and Documents--The Definitive Edition (The Collected Works of F. A. Hayek, Volume 2) Paperback – March 30, 2007

If you believe that stripping people of their freedoms and enslaving them makes for a great society, then you’ll find Hayek’s “The Road To Serfdom” to be a wonderful ‘how-to’ manual. Otherwise, if you think people should be left to maintain their individual rights and freedoms and have minimal constraints laid upon them, then this work will help you to recognize the threats - under the guise of justice and equality - that gather against them.Hayek’s book can be read from three perspectives: as a piece of history, as a piece about history, and as a reasoned argument on why socialism fails.As a piece of history, Hayek (Nobel prize in economics 1974) wrote this book during the second world war while living in England. Having grown up and been educated in Austria, and teaching at the London School of Economics, he was concerned that the British (and the Americans) were moving toward post-war socialism. This was his warning of the dangers that socialism posed.That Hayek had personally observed the development of socialism in Austria and Germany, this book is much about the history of socialism, from its origins in the early 19th century up to the establishment of the totalitarian governments of Germany, Italy, and Russia. A difficulty for current readers is that in much of what Hayek refers to, he assumed that readers of the 1940's understood implicitly. Wading through this now obscure history, however, provides interesting insight into the political discourse of the time, and is thus in its own right, a piece of history.As a reasoned argument with observations on how socialism destroys liberty and fails economically is what I'll try to cover in this review.Socialism encompasses the ideas of social justice, equality and security. These are its ultimate goals. The methods of how to obtain them are seldom detailed by its adherents, but generally what is required and expected is the abolition of private property, the abolition of the private ownership of the means of production, and the establishment of a centrally planned economy that distributes wealth equitably.The central attraction to socialism is “the potential plenty for all.” The belief is that with the level of technology and wealth we have achieved we can now, with proper planning, create even greater wealth and rapidly and distribute it equally to all. What is forgotten - or drowned out in the demonization of capitalism - is that this current wealth and technology was achieved in the first place through the capitalist, free market system.A dilemma immediately presents itself in the process of trying to achieve this justice and equality. The problem is that fairness of outcome cannot be achieved by the application of a universal rule of law. This is so because some people, due either to their natural talents or their preposition in life, will be better off and will do better than others. Laws under socialism may start with an equal application to all, but soon will evolve to favor or disfavor particular groups, ultimately crippling the universal rule of law with exceptions, and throwing decision specifics to politicized judges or other authorities to achieve ‘equality of outcome.’ The result is the destruction of individual rights and the rule of law.Economic planning cannot help but interfere with political life and curtail individual freedoms. Transferring property and the means of production to state ownership is the ultimate form of a liberty robbing monopoly. Freedom of consumption becomes limited to what the state is willing or able to produce. Freedom to work in jobs of one’s own choice is limited by the state’s determination of the makeup of the workforce. The disaffected - those who have lost property, those stuck in unfulfilling jobs, those who cannot obtain the goods they desire - will find that freedom of speech is also not tolerated. Hardly any aspect of life will not be affected.State ownership of the means of production - even limited state ownership - places the state in the position where, in effect, it determines all people’s incomes. The close interdependence of all economic phenomenon makes it impossible to limit the degree of planning. The livelihood of individuals will no longer be determined by the impersonal forces of free markets, but by the deliberate decisions of state authority. In socialism, everyone is to receive their due according to an absolute, universal standard of right, but the political difficulties in determining and enforcing a common view of ‘the right’ is insurmountable in large heterogeneous groups. The more security offered to any one group necessarily takes freedoms from others, contributing more to the legions of the disaffected.One of the attractions of socialism is that it promises to eliminate the uncertainties of market economies, and thus provide ‘freedom’ from the vagaries of economic cycles. Enforcing security, however, from price fluctuations leads to inefficiencies and stagnation in the economy, as price discovery and labor flexibility is necessarily inhibited. This impulse for security leads directly to a loss of individual liberty along with a loss of economy vitality.In a socialist system with income security, inefficiency and stagnation, individuals will not sustain their best productivity, thus burdening the economy further and sending society into an ever deepening malaise. The resulting degradation in the economy may result in an equality of benefits, but will also result in an equal sharing of greater poverty.Motivating workers to maintain productivity is an ever present problem, as is the containment of the less than virtuous persons. The only power to be had in a socialist society is to share in the coercive power of the state. Clearly, becoming a member of a group that can influence or control the state machinery is the only avenue available to improve one’s position in life, a situation that naturally attracts the less than virtuous. A tug-of-war of interest groups ensues. Who will plan from whom? The poorest and most numerous are most likely to lose out, while corruption, graft, and a new ruling elite takes root.There is the belief that because socialism springs from high moral beliefs that it will produce leaders of high moral character. Good results, however, do not necessarily follow from good intentions. Necessarily, the talents required to lead and administer a socialist system are the least desirable and least virtuous. The argument that current and past socialist failures is due to the wrong people fomenting them, and the argument continues that future socialist systems will succeed with the right persons in the lead. This is categorically wrong - as no political system should be dependent upon the talent and virtue of individuals. Even a democratically elected leader, with the intention of delivering on socialist goals, will either have to eventually give up his goals, or assume dictatorial powers to achieve them. For a dictator, he will have to either abandon standard moral values or face failure of his program. It is the unattainable goals of socialism that produces the heinous leaders that populate the history of the effort, and will continue to do so in the future.Bringing socialism into being requires making everyone believe in the plan and goals of the system. Control of the public narrative, and suppression of private thought is necessary for the central authority to maintain power. The allegiance to truth is an early victim - and as respect for truth is the foundation of all morality, this ultimately leads to the debasement of all moral authority of the socialist system. Capture by the central authority of the entire knowledge industry, from news outlets, to opinion leaders, to the education system is a necessity. Even disinterested, apolitical knowledge, such as the pursuit of science and innovation is stifled; entertainment is closely monitored. The irony is that the impulse of collectivist thought is to guide social development through reason, yet it has the ultimate effect of destroying reason.Power vested in the hands of individuals is feared and detested by those who advocate socialism. Their solution, to this seeming problem, is to take power away from individuals and create a new and greater center of power, a concentrated power unimaginable under any system of individual liberty. No one in an individualist, free market society could ever wield the power of a socialist planning commission. To define, implement, and administer central planning, a centralized authority is required, and ultimately, centralized authority leads to dictatorship.Forgetting the devastation socialism causes to the life of the individual and consequent damage to the vitality of society, central planning can never direct the economy to equitably provide for all. This is evident simply on the basis that the centralized collection and analysis of the massive amount of information required is impossible. The residue of legitimacy left of socialism - the belief that it will secure a more just and equitable distribution of wealth - is false. Wherever greater information is gathered, greater wealth and privilege follows, be it capitalist or socialist. Self-sacrificing virtue cannot be relied upon to distribute goods and services equitably, and in fact it is structurally impossible.Hayek does not make a concerted effort to promote capitalism or free market economies, this he assumes has been done adequately by others, but he does on occasion interject observations on how free markets solve various problems better than planned economies. Hayek’s view is that from the limitations of our money based economies, we are made to feel the restrictions of our relative wealth, which leads to the socialist impulse. However in Hayek’s opinion, money, and the free exchange of goods and services, is one of the greatest innovations ever created to promote freedom and alleviate poverty.The only explanation for the current and apparently rising interest in socialism, is the general lack of understanding of what it is and where it leads. Hayek’s “Serfdom,” sixty-five years on, is for those willing to take on the challenge, a great antidote for this affliction

I sincerely believe that in the future, “The Road to Serfdom “will rank alongside works of the John Locke, Adam Smith, Edmond Burke, Alexis De Tocqueville, and Ludwig von Mises in defining human freedom. Its insights inspire me to read it again at least every few years. And that is easy to do because it is a brief, well written book that explains how essential the freedom and dignity of each human individual are to the formation of a prosperous, good and just society.Like many young, intelligent, concerned people, Hayek started his adult life as a democratic socialist, the trendy thing for young people then and now. But World War I caused him to questions the assumptions he had made about the social order. In conversations with his cousin Ludwig Wittgenstein, he developed a strong desire to discover ways that humanity might avoid the tragedy of the War in future. He studied with numerous academic luminaries in Vienna after the war including the renowned economist and powerful anti-socialist Ludwig von Mises. Then, in 1931, he wrote a book that earned him an invitation to join the London School of Economics where he famously debated the demand-side guru, John Maynard Keynes. Keynes won these debates in the short run and held sway over mid-century world economic policy, but lost to history with the supply-side revolution of Freedman, Reagan and Thatcher who all acknowledged their great debt to Fredrick Hayek. This book is not Hayek’s crowning achievement in academic economics (for that work he won a Nobel Prize) nevertheless, it is his most famous and influential work.As undergraduates, many people read Plato, particularly “The Republic”, and are enthralled. The idea that we can willfully design a perfect, conflict free society is seductive and desirable to young minds who have just left the security of the family, or not. Philosophers in the 19th century rebelled against the hegemony of determanistic materialism that had held sway since Francis Bacon began the struggle to push the Church’s Plato back into the Pandora ’s Box it came from. Successively, Hume, Kant, Hegel, Marx, Comte and Mill reopened the box. But without the Church to teach them otherwise, men began to believe they could perfect themselves. Bismarck and Woodrow Wilson made the first political attempts at a Great Society with seeming benevolence. Mussolini, Hitler, Tojo, Stalin and Mao followed their example with significantly less universally humane intent. All of these politicians believed they could organize the world into a scientifically created Eden sans deity through extensive economic planning by a central governing authority vested in academic experts. This authority would have the power to distribute goods and services in such a way that people would be freed from want and from mundane economic decisions. They could live their lives in pursuit of those things much loftier than material wealth. They could fill their days with art and science and comradery and love. Organization and planning would liberate humanity from strife, privation, drudgery and tedium. For nearly one hundred and fifty years socialist doctrine has imbued this dream-world into the heads of the young, the desperate, the hungry, the angry, the resentful and the lonely. Social economic planning was the perfect religious message for generations of men who had lost the Religion of Divinity and were searching for a religion within themselves. Many politicians believe this still today or cynically advocated such policies to accrue power from the gullible.So the Road to Serfdom is analysis of this intense human desire to organize the world around us through planning in order to achieve some always ill-defined optimum for all. The book clearly demonstrates that the great flaw in this idea is that men can never get together and agree exactly what to plan for or what is optimal. The artist will want resources allocated to the National Endowment for the Arts; the scientist will insist that more be sent to the National Institutes for Health; the farmer will demand that subsidies for corn are the only way society can survive, parents and students will demand bursary, and the poor will clamor for support. This will inevitably lead to conflict as what each man lobbies for is not really an optimum for all but an optimum for himself. The only way these conflicts can be resolved is through a strong central authority that can coerce the cooperation of all the members of society and assign priorities for the allocation of resources. As men will always resist coercion, the applied authority must become increasingly violent to the point of being life threatening in order to impose its central economic will. As the process of organization and planning becomes ever more comprehensive, ultimate authority must eventually be concentrated in the hands of one person, a dictator. In Hayek’s words:“Most planners who have seriously considered the practical aspects of their task have little doubt that a directed economy must be run on more or less dictatorial lines. That the complex system of interrelated activities, if it is to be consciously directed at all, must be directed by a single staff of experts, and that ultimate responsibility and power must rest in the hands of a commander-in-chief whose actions must not be fettered by democratic procedure .........[planners believe that] by giving up freedom in what are, or ought to be, the less important aspects of our lives, we shall obtain greater freedom in the pursuit of higher values.”But by giving up economic control do we attain that greater freedom? No. There was no such thing as recreation in Soviet Russia, Hitler had an entire program to fill peoples spare time, the Kraft durch Freude (Strength through Joy), and North Korea’s uber thug, Kim Jong-un, has of late constructed a ski resort though very few people have the money or the nutritional health to use it. All these systems insisted that you will relax and recreate as they tell you. You will read the books they tell you to read. You will perform only the plays they tell you to perform. You will live your life for their priorities. For a planned society to work, people eventually must surrender complete control of their lives, even their leisure, to the planners for the sake of the whole.Collectivist sentiment arose in the 19th century as a backlash against unrestrained, Laissez-faire Capitalism. Most of today’s remaining socialists view this Laissez-faire Capitalism as the enemy they are still fighting though such a system is long gone and unlamented. Who would play Monopoly if there were no rules at all and theft and deceit were the norm; that is lawless Laissez-faire economic anarchy. But who would play Monopoly if the rules changed at the violent and arbitrary insistence of an all-powerful “Planner” controlling every aspect of the board; that is Socialism. But why should we play either game with our economic lives? People use the term “The Third Way” to try and accommodate planning without resort to dictatorship. But Hayek shows the impossibility of this Third Way and points us to the only way. What Hayek advocates is a Capitalist system with clearly defined rules that apply to everyone, no exceptions, and enduring restraints and limits on the power of government. He argues for consistency and democracy where the playing field is level for everyone and we are all free economic entities making our own economic decisions based on our own desires, our own resources and our own conscience. What he argues is Edmond Burke, 175 years on in an effort to correct the horrific damage we have inflicted on ourselves with the hubris that we could actually perfect ourselves through planning without throwing away our very humanity.Unfortunately, over 70 years after its completion, Hayek’s description of planners and his warning about their cynical attitude toward personal competence and responsibility can be seen hard at work within our own supposedly free democratic government. In the weeks before I wrote this, a powerful academic from MIT, economist Jonathan Gruber, renowned as the architect of the Affordable Care Act (aka Obamacare) has been discovered to have said that “the stupidity of the American voter” made it important for him and Democrats to obscure the true costs of the health care program from the public. “That [hiding the details] was really, really critical for the thing to pass,” said Gruber. “But I’d rather have this law than not.” Thus, Gruber’s ends justify any means including mass deception of the populous of the world’s greatest democratic republic, a populous he openly regards as incompetent and stupid. Deception is the first form of violence perpetrated on the people by planners when they achieve power. For such self-appointed experts, their plan is so important that the vox populi must be silenced first only by stealth, but surely force will soon follow. Their plan is just too important. This is Hayek’s warning for posterity. William F. Buckley Jr. said it best, following Hayek, “I am obliged to confess I should sooner live in a society governed by the first two thousand names in the Boston telephone directory than in a society governed by the two thousand faculty members of Harvard University.” Or MIT.Life is and will be always a struggle toward freedom and dignity for each man and woman. That freedom and dignity can never be perfectly attained, but what of these we can manage only comes through personal economic empowerment. That empowerment comes when we throw off the yoke of powerful individuals and defiantly refuse the thralldom they offer in exchange for illusions of security and freedom from the mundane. After the implosion of the former Soviet mega-dictatorship, numerous influential people threw off that yoke and immerged from the economic morass of Socialism to lead the Eastern bloc back toward prosperity on the model of the modern Western democracies and Capitalism based on knowledge they had gained from smuggled copies of this book and those of Hayek’s successor, Milton Friedman. Millions of people had gladly descended down the wrong path and now had to claw their way back out of the Cave Plato had lead them into. Hayek showed them that way back. Many people emerging from under the heel of that Evil Empire have attested to the enlightenment they received from the banned copies of the works of Hayek. Hayek showed these oppressed people as he has shown the ages that to allow people who strive through Plato’s supreme creation of societal hubris to plan and design and control our society for our own good is “The Road to Serfdom.”