Hayek on The False Promise of Socialism and The Road to Serfdom

This is Chapter 6 of Boettke on Hayek. From the academic critique of central planning Hayek moved to more direct political engagement with the socialists in The Road to Serfdom (1944). Some of this was written in Cambridge where Keynes offered his great intellectual opponent sanctuary from the hazards of London in his college (Kings) that once housed Isaac Newton and a galaxy of other notables.

He and Keynes spent some time together on the roof of the college fire-watching when the Germans switched their strategy to “Baedeker bombing” to undermine British morale by attacking major cultural targets especially York, Norwich, Exeter, Canterbury and Bath. This lends some credence to the alleged statement of an Oxbridge don who was asked what he did in the war and replied “I am what the war was about”. That was when there was free speech on the campus.

The chapter begins with the statement that WWII ended with victory for the western democracies. That may be an overly optimistic view because the war effectively ended Britain’s role as a great power and converted Russian into the Soviet empire that soon reached around world as the Soviets absorbed decolonised states and significantly contributed to Mao’s victory in China. And that is before we consider the war of ideas in the west where young socialists could have swept Bernie Sanders into the White House if the Clinton forces had played fair and in Britain they almost elected Jeremy Corbyn who is still favoured to win the next election despite a long record of support for communism and anti-Semitism.

The point of this chapter is to explain the situational analysis that Hayek pursued to warn well-meaning socialists of the things that could go wrong. He might have cited Murphy’s Law and also Parkinson’s Law that explains why government departments get bigger when there is less for them to do, like the Navy department in Britain that grew while the fleet contracted and the Foreign Office that expanded while the empire faded away. This is an early example of methodological individualism and situational analysis to show how the process works in detail.

Boettke contests the familiar criticism that The Road to Serfdom predicted a slippery slope to communism the moment that we allow even the most modest state interventions. Hayek himself did not accept that and he later wrote a much bigger book The Constitution of Liberty to argue that a governments could do a great deal to provide services in addition to the minimum of security and law enforcement as long as the Rule of Law is not undermined and the moral framework including the spirit of liberty is strong. [Sound fx ominous music].

The chapter can be read in the same way as Tullock on the organization of inquiry – as a warning of what can happen if things do not go well with the obvious implication that we had better do whatever we can do make things go better. Forewarned is forearmed. The most important information that you can have is the plans of the enemy. (Read Alinsky again).

To illustrate, last week a practically one-armed halfback led the Sydney Roosters to victory over the notorious Melbourne Storm in the National Rugby League grand final. The arm was disabled in a heavy tackle the week before and the participation of Cooper Cronk was in doubt until the day before. The point is that Mr Cronk played halfback for the Storm and called their shots for a decade, so essentially the Roosters bought the Melbourne playbook and the man who could read it and make the defensive calls for the Roosters on the field.

Hayek was reading the socialist playbook and calling the defence. The first line was the academic argument that the socialist plays would not produce the results that they wanted, like everyone else – freedom and justice, peace and plenty. There were political aspects as well like the way the dynamics of socialism would bring the worst to the top.

He called shots in the battle of ideas – his abuse of reason project to counter various unhelpful conceptions of reason and rationality, his major effort to correct at the intellectual level the corruption of justice from traditional individualistic justice, the even-handed administration of non-discriminatory laws, to ‘social justice’ – collectivist righting of past wrongs. And so on.

He called organizational shots as well, like the Mont Pelerin Society to keep the ideas of classical liberalism alive. He told Antony Fisher to leave politics alone and start a think tank. The result is the IEA, the Institute of Economic Affairs, after the Melbourne-based IPA one of the first of the worldwide network of think tanks.

Getting back to the slippery slope, Boettke cites empirical work that suggests that freedom as measured by the well-known Economic Freedom Index has grown in parallel with the increase in government spending as a fraction of GDP in the western democracies. The reference is Alves and Meadowcraft.

This is interesting and so is the criticism of the Freedom Index by our Canberra colleague William Coleman who suggests that the high ranking that Australia achieved on the index is illusory. He also came up with a handy quote from Jacob Viner in response to Lord Kelvin’s dictum that “When you cannot express it in numbers, your knowledge is of a meagre and unsatisfactory kind”. Viner suggested, as a rebuke to some aspects of mathematical economics ‘When you cannot express it in numbers . . . well, go and express it in numbers anyway!’

A final comment before terminating a post that is too long already, the situation may have deteriorated since the time that Pete Boettke wrote that chapter. There may have been something like a tipping point in the activity and virulence of the left in the last two or three years and so the jury is still out on the case for the slippery slope argument.

11am Wind and Other racing at 9% of demand!

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4 Responses to Hayek on The False Promise of Socialism and The Road to Serfdom

  1. Roger

    Typo, Rafe: Baedeker bombing.

  2. Tim Neilson

    I’m pretty sure there weren’t actually any Baedeker raids on Oxford or Cambridge. I recall reading that Hitler wanted to possess them too much to be willing to destroy them.

  3. Rafe Champion

    Yes, I wonder why they were fire-watching? Preventive I suppose, there is no record of actually fighting fires and now you mention it I don’t recall ever reading about bombs in Oxford or Cambridge. It was quite different at Exeter, in the 1970s when I stayed there my hosts told me about the damage in the vicinity of the great cathedral.

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