Hayek’s Zombie Idea

by John Quiggin on October 1, 2010

I’m paying close attention to Amazon rankings just now[1], and it’s striking that both the #1 and #2 spots in “Economics-Theory” are held by FA Hayek’s Road to Serfdom. Whatever your view of Hayek’s work in general, this is truly bizarre, and indicative of the kind of disconnection from reality going on on the political right. On the natural interpretation, shared by everyone in mainstream economics from Samuelson to Stigler, this book, which argued that the policies advocated by the British Labour Party in 1944 would lead to a totalitarian dictatorship, was a piece of misprediction comparable to Glassman and Hassett’s Dow 36000. So what is going on in the minds of the buyers? Are they crazy? Do they actually think that Hayek was proven right after all? Is there a defensible interpretation of Hayek that makes sense?

The answers are “Yes”, “Yes” and “No”. The current sales of Hayek’s book are being driven by Glenn Beck, who claims that Britain is indeed a socialist dictatorship of the kind predicted by Hayek (or was, until the recent election), and that Obama is propelling the US along the Road to Serfdom by making medical care marginally more affordable.

Until the right went completely crazy, the most common claim in support of Hayek was that his predictions had somehow been vindicated by Thatcher’s reaction against the welfare state. Leaving aside the fact that Thatcher’s remodelling of the British economy in the image of the City of London looks a lot less appealing today than it did only a few years ago, this totally misses the point of Hayek’s book. If he had wanted to argue that social democratic policies would reduce the rate of economic growth, and to throw in a bit of hyperbole, he could have called it “The Road to Destitution” or something similar. Hayek wanted to make the much stronger claim that the attempt to implement Labor’s policies would necessarily lead to a loss of personal and political freedom.

The most plausible attempt to extract a defensible claim from The Road to Serfdom is to suggest that it applied to policies of comprehensive and centralised economic planning, which might, on an extreme reading, have been imputed to the Labour Party of 1944. Fortunately, on this account, Labour saw the folly of such ideas and did not attempt to implement them. Even on this charitable account, a book warning against hypothetical policies that might have been, but weren’t, adopted in the early postwar period, and aren’t advocated by anybody nowadays, would be of fairly marginal historical interest. But, as Ed McPhail and Andrew Farrant have shown (I’ve linked to a summary since the article seems to be paywalled) this view can’t really be defended.

Depressingly, most of the rest of the “economic theory Top 20” list, including Wealth of Nations, Free to Choose and the writings of Peter Schiff, suggest that the buyers are the same people buying (if perhaps not reading) Hayek. If people actually read Smith, particularly the Moral Sentiments they might gain something, but these purchases look more like an affirmation of tribal identity than an attempt to learn something.

fn1. Zombie Economics briefly made it into the Economics-theory Top 20, but is now slipping out again.

{ 191 comments }

1

bob mcmanus 10.01.10 at 6:18 am

David Harvey at 15 is very good news.

2

John Quiggin 10.01.10 at 6:45 am

Indeed, and also Sen @13

3

bh 10.01.10 at 7:22 am

It seems like respectable econ opinion here in the US regards TRTS as ‘bad’ Hayek, and I certainly agree with that part. There’s always an implied ‘good’ Hayek, though, and I can’t say I’ve encountered that one personally. I get that his other work doesn’t make as transparently ridicululous predictions, but I’ve never encountered anything he wrote that struck me as interesting or insightful.

Am I missing something?

(And I know I’m kind of inviting this, but I’m not really interested in reading one of his libertarian alcolytes step through his work like it’s scripture. I’ve seen a lot of that, and it always makes me think worse of both parties.)

4

Timothy Scriven 10.01.10 at 7:42 am

“By Glenn Beck, who claims that Britain is indeed a socialist dictatorship of the kind predicted by Hayek (or was, until the recent election), and that Obama is propelling the US along the Road to Serfdom by making medical care marginally more affordable.”

I’m currently experiencing a phenomenologically interesting moment. I am thinking “One would have thought that, by definition a totalitarian state cannot be defeated by an election.” I am trying to cope with the thought that a vast number of voters believe analytically false things because it is tribalistically acceptable.

Yet at the same time I recognise that there is no point, in and of itself, to vocalising this feeling. We are simply at a point where a whole class of people are beyond argument, outside the space of reasons. And for the first time it’s hitting me hard that between a quarter and a third of America, and presumably a smaller but still substantial number in Australia, is in such a state that, with respect to politics, they have simply left the space of reasons. I cannot relate to them by giving reasons, I cannot join them in a conversation, they have left the circle of rational agents. Consequently I feel confused. What stance should I take with respect to such people, do I blame them or pity them. How do I reconcile the fact that such people vote in my country with my belief that I live in a democracy, and a belief that democracy imposes stiffer conditions than mere fair voting and counting?

5

Stephen Judd 10.01.10 at 7:44 am

My edition of the The Road to Serfdom says (p134 of the University of Chicago’s 50th anniversary edition):

Where, as in the case of sickness and accident, neither the desire to avoid such calamities nor the efforts to overcome their consequences are as a rule weakened by the provision of assistance — where, in short, we deal with genuinely insurable risks — the case for the state’s helping to organise a comprehensive system of social insurance is very strong…. Wherever communal action can mitigate disasters against which the individual can neither attempt to guard himself nor make provision for the consequences, such communal action should undoubtedly be taken.

Funny how the acolytes never seem to read that bit.

6

Myles SG 10.01.10 at 7:52 am

Well it’s one of those books whose merit is undiminished by its factual errors. Which is to say, people read the Road to Serfdorm as a polemic, a sort of call to arms, rather than a factual prediction (and in any case any relevance it had as a predictive text has long since lapsed). In such a polemic the facts of his prediction, and his inaccuracy, does not matter. What matters is the moral sentiment of the book.

In the same way the modern-day student might read Marx’s work that includes predicting the end of capitalism, despite his errors of prediction, so might a libertarian-minded person read Hayek.

7

Myles SG 10.01.10 at 7:54 am

When I obtained my copy of Road to Serfdom, I wasn’t even aware that he wrote it as a warning against post-war Labour government in Britain. I was simply informed that it was an extraordinarily good and moving good, and perhaps one of the most brilliant anti-collectivist texts ever penned. And that’s why I got it, while having no awareness whatsoever of its relation to British Labour.

I am sure lots of others obtained the book under the same frame of mind.

8

Myles SG 10.01.10 at 8:03 am

IN any case, from Wikipedia:

“During the Nobel ceremony in December 1974, Hayek met the Russian dissident Aleksandr Solzhenitsyn. Hayek later sent him a Russian translation of The Road to Serfdom and Solzhenitsyn was surprised that someone who had not lived in Russia could see so clearly the effects of socialism.” (Article on F.A. Hayek)

I suppose that’s where the worth and value of the book will have to be. Not as a specific catalogue of events, but as the competent expression of a widely felt feeling.

9

bh 10.01.10 at 8:10 am

So Myles, ‘factual bullocks that emotionally resonates with me’ is a defense? I just want to give up sometimes…

Also, Solzhenitsyn, for whatever his literary value, was profoundly full of shit about lots of stuff too…

10

Nick 10.01.10 at 8:43 am

Why Read Hayek Today?

He predicted the Wall Street crash before it happened. He was on-board with the best immediate solutions to the Great Depression (similar to the best response to the current crisis): http://www.themoneyillusion.com/?p=5966

And he has an interesting long-term solution to financial crises too: http://www.iea.org.uk/record.jsp?type=book&ID=431

The Road to Serfdom itself is a great piece of advocacy aimed at socialists where he carefully explains the difference between a broad basic safety-net based on general rules (including some forms of social insurance), and a system based on special privileges and arbitrary planning. In retrospect, this point is so obvious that well-read contemporary liberals/social democrats dont really notice it – the critique has been absorbed into mainstream political economy. But in terms of policy outcomes, it is still a useful thing to bear in mind, as it is quite good at pointing out why Greece is still in such a terrible state and why aspects of US healthcare reform are likely to run into problems.

11

john 10.01.10 at 9:16 am

I’m pretty sure that the Greek Government is in trouble because it had to take on crippling private sector debt, but hey, why let that get in the way of ideology?

12

Sufferin' Succotash 10.01.10 at 11:25 am

Nothing like bulk purchasing to inflate book sales.

13

Uncle Kvetch 10.01.10 at 12:03 pm

Leaving aside the fact that Thatcher’s remodelling of the British economy in the image of the City of London looks a lot less appealing today than it did only a few years ago

A lot less appealing to whom? I would think that for someone with Glenn Beck’s income it still holds enormous appeal.

14

Steve LaBonne 10.01.10 at 12:23 pm

Wouldn’t Hayek’s books sell even better if they were shelved appropriately, in the religion section?

15

rickstersherpa 10.01.10 at 12:59 pm

I have been buying my books (Yves Smith’s, Dean Baker’s, and Simon Johnson’s and James Kwaks) on Barnes and Noble. I will go on Amazon and get Zombie Economics. And yes, I doubt most of these folk are actually reading Hayek or Smith, but just buying it because Glenn Beck told them to (like they are buying Tom Paine who if they actually read would shock the hell out them!).

16

Matt 10.01.10 at 1:23 pm

On the road in front of me today was a car with a bumper sticker that said, “Health care rationing is FASCISM!” (caps in original.) Strange thought patterns indeed, especially given that, as Stephen points out in 5 above, Hayek supported some version of a social safety net his whole life.

17

Gene O'Grady 10.01.10 at 1:50 pm

I remember well the 50th anniversary of The Road to Socialism. I happened to be sharing an office with Tom Sowell’s step-daughter and she greeted the occasion as if it were a personal apparition of the Virgin Mary.

But in response to Steve LaBonne, real theologians are in fact less self-indulgent than Hayek and their readers are far more critical.

18

P O'Neill 10.01.10 at 1:58 pm

#5, unfortunately the wingers pay at least lip service to having read that passage of Hayek.

In addition to the tribal aspect to the book purchases, don’t underestimate the power of vanity and also the need in winger circles for portent. It’s always 1776, 1938, or 1944 in their eyes.

19

Magnus Ramage 10.01.10 at 2:00 pm

I’m not sure I’d agree that the right has gone “completely crazy” in the UK (relevant given the mention of the British context). The Conservative party under Cameron, even before the coalition, has its share of crazies, but nothing remotely like the US or Australian scene. And the coalition has moderated the crazies somewhat.

That doesn’t mean their policies are correct, or pleasant, or won’t cause great damage, and they are certainly in part ideologically-driven. But I think the right-wing themselves and their supporters are mostly quite sane here. The American right, by contrast, are really scary. Whenever I think of Sarah Palin, my abiding memory of her election campaign are rallies of people chanting “USA! USA! USA!”. That really did sound like the path to totalitarianism.

20

Myles SG 10.01.10 at 2:08 pm

So Myles, ‘factual bullocks that emotionally resonates with me’ is a defense? I just want to give up sometimes…

Yet one could say the same about some of Marx. And no one claims that Marx is irrelevant simply because he made some whopper predictions.

21

Myles SG 10.01.10 at 2:12 pm

Also, Solzhenitsyn, for whatever his literary value, was profoundly full of shit about lots of stuff too…

The usually appreciation of Solzhenitsyn concedes that he was no Tolstoy in literary value, but argues rather that his importance arises out of his historical value, and from the moral and political importance of his works.

I am not sure where your claim about Solzhenitsyn’s literary value is coming from.

22

Cryptic Ned 10.01.10 at 2:18 pm

Whenever I think of Sarah Palin, my abiding memory of her election campaign are rallies of people chanting “USA! USA! USA!”. That really did sound like the path to totalitarianism.

Those chants are nothing new.

23

K. Williams 10.01.10 at 2:27 pm

“It seems like respectable econ opinion here in the US regards TRTS as ‘bad’ Hayek, and I certainly agree with that part. There’s always an implied ‘good’ Hayek, though, and I can’t say I’ve encountered that one personally. I get that his other work doesn’t make as transparently ridicululous predictions, but I’ve never encountered anything he wrote that struck me as interesting or insightful.

“Am I missing something?”

Shorter every post by bh: This writer doesn’t hate capitalism and writes for a popular audience, therefore he sucks.

24

zamfir 10.01.10 at 2:28 pm

Nick, there is something conflicting your description. Either Hayek’s predictions didn’t come true because his earnings became mainstream, or he is still interesting as a warning for mistakes people are actually likely to make. But you can’t have it both ways, unless you want to argue that Obama is so much more socialist than Attlee that he is outside of that mainstream, but Attlee was in.

I think there is a very similar dilemma in Myles’ reference to Solzhenitzyn. Road to serfdom might be an accurate description of the Soviet Union, or a useful analysis of Western welfare states. But it can hardly be both.

25

Nick 10.01.10 at 2:55 pm

zamfir –

It is not necessarily about conflicting perspectives, I am just talking about the difference between theories and policies. Theoretically, everyone is pretty much on-board about how things like due process, the rule of law, and broad general transparent regulations are essential both to individual liberty and economic prosperity. In practice, however, there are still plenty of policies that fail to live up to these conditions. These require critique and reform; and Hayek is a fine place to start looking at why and how.

And I don’t think Obama is significantly worse or better than his predecessors on this front.

26

Myles SG 10.01.10 at 3:05 pm

I think there is a very similar dilemma in Myles’ reference to Solzhenitzyn. Road to serfdom might be an accurate description of the Soviet Union, or a useful analysis of Western welfare states. But it can hardly be both.

Well, it’s clearly inaccurate as analyses of Western welfare states, but very prescient of where they could have been headed. But its general importance was derived from its value as an anti-Communist polemic. Even if it were accurate, no one would care about polemics written against the British Labour party.

And shorter bh indeed. Seriously, get a grip. Just because you dislike the modern-day results of the actions of people having been influenced by the likes of Hayek does not allow you to parade righteously about in your hate for Hayek himself, just as the USSR, in its perversion of Marxism, not invalidate Marx.

27

Leland Olds 10.01.10 at 3:17 pm

Correct me if I am wrong (I was born the year of Thatcher’s election), but wasn’t a key aspect of the neoliberal argument that it would deliver “the goods” in a utilitarian sense–the greatest good for the greatest number–in a way that ole’ social democracy could not. In the US at least, the neoliberal austerity cheerleaders don’t even seem bother with this stuff any more.

For true believers in the US, TRTS offers a simple narrative that is instantly comprehensible. Plus, the guy won a Noble Prize in the 70s and he was a professor and everything. He even wore glasses! The arguments put forward by other eggheads may now be safely ignored.

28

MPAVictoria 10.01.10 at 3:17 pm

“Well, it’s clearly inaccurate as analyses of Western welfare states, but very prescient of where they could have been headed.”
Really? I suppose anything is possible but if you look at the actual evidence the social democratic parties in western countries were never likely to remodel their nations after the USSR. Are you really going to tell me that Tommy Douglas wanted to turn Canada into a totalitarian state? That the CCF was secretly planning to end elections and freedom of the press?

29

piglet 10.01.10 at 3:22 pm

“In practice, however, there are still plenty of policies that fail to live up to these conditions.” … many of which were implemented by Hayek admirers. Right-wingers don’t care about Hayek because they wish to defend due process and the rule of law (if they wanted that, they’d have stood up to Bush). Right-wingers care about Hayek because he gives substance (in their eyes at least) to their crazy anti-liberal hysteria. Right-wingers do not say say “we oppose this policy because it violates due process”, they say “this policy was suggested by somebody to the left of us and Hayek says that left policies are the road to serfdom, therefore we oppose it”.

And as has been pointed out, it doesn’t even matter that Hayek in fact supported social health insurance.

30

Lemuel Pitkin 10.01.10 at 3:26 pm

I haven’t read TRTS and don’t expect to. That said, while it’s arguments are, as you say, completely wrong in retrospect, were they necessarily crazy?

It seems to me that many people other than Hayek believed there was an incremental, more or less self-sustaining path from the regulatory welfare state, to more or less comprehensive socialism. Most of those people thought that was a good thing. (As would I, if I believed it.) And within certain limits, the dynamic still applies — e.g. almost everything we think of as the New Deal started out much more limited in scope. So if you regard e.g. the minimum wage as a infringement on liberty then Hayek doesn’t look so silly, since the range of jobs it covers has grown steadily over time. Or if you, like many American conservatives, believe that the the right to exclude black people from your business or neighborhood is a fundamental liberty, then we have indeed come along way toward tyranny.

(Remember that old Phil Ochs song? “It’s pinkos like you that freed the salves.” If the bottom rail doesn’t stay on the bottom, then it must be on top. That’s the operational meaning of serfdom.)

Seems to me,a s Uncle Kvetch suggests at 12, that this is a case of liberals assuming conservatives are people who share our goals but unfortunately are nuts, when it may be that they simply have different goals.

31

Lemuel Pitkin 10.01.10 at 3:27 pm

salves s/b slaves, of course….

32

zamfir 10.01.10 at 3:34 pm

Myles, I don’t think you can be prescient about things that did not happen.

33

ChrisJ 10.01.10 at 3:56 pm

“On the road in front of me today was a car with a bumper sticker that said, “Health care rationing is FASCISM!” (caps in original.) Strange thought patterns indeed, especially given that, as Stephen points out in 5 above, Hayek supported some version of a social safety net his whole life.”

Odder to me is the failure to recognize that we already have healthcare rationing — by economic class. I suppose that variety of rationing of a resource that everyone in society needs isn’t fascism to these folks.

34

dsquared 10.01.10 at 4:08 pm

Well, it’s clearly inaccurate as analyses of Western welfare states, but very prescient of where they could have been headed

I like this concept of “very prescient about where they could have been headed”. Although as far as I can see the words “could have been” ought to be replaced by the word “weren’t”.

35

Lemuel Pitkin 10.01.10 at 4:11 pm

the failure to recognize that we already have healthcare rationing—by economic class.

I think the key here is that the existence of hierarchy and inequality is seen as both inevitable and desirable. Someone has to be a serf: If it’s not them, it will be us. From this point of view, if “they” no longer face rationing by income, then “we” will have to be rationed instead, by death panels or whatever.

36

Alex 10.01.10 at 4:12 pm

If you’re willing to grant that Marxism has value as an analytic method, even though using it as an operations manual may be unwise, you’ve surely got to grant the same for Hayek…

37

Lemuel Pitkin 10.01.10 at 4:19 pm

I like this concept of “very prescient about where they could have been headed”. Although as far as I can see the words “could have been” ought to be replaced by the word “weren’t”.

The classic example of this usage, at least as far as CT threads are concerned, remains this.

38

Salient 10.01.10 at 4:38 pm

I suppose that variety of rationing of a resource that everyone in society needs isn’t fascism to these folks.

Preventing me from exercising my privilege is fascism, as is attempting to extend that privilege to other people who don’t have it, because part of my privilege is getting to enjoy things that the less ‘hard-working’ people can’t.

39

ChrisJ 10.01.10 at 4:40 pm

“I think the key here is that the existence of hierarchy and inequality is seen as both inevitable and desirable. Someone has to be a serf: If it’s not them, it will be us. From this point of view, if “they” no longer face rationing by income, then “we” will have to be rationed instead, by death panels or whatever.”

Indeed. Especially since economic class is, in that worldview, a proxy for intrinsic worthiness.

40

bh 10.01.10 at 4:47 pm

Yet one could say the same about some of Marx. And no one claims that Marx is irrelevant simply because he made some whopper predictions.

Are you kidding? I’ve heard a number of mainstream economists — on paper, in lectures, in casual conversation — say exactly that. And fwiw, I agree with them to a degree. Marx’s bad predictions should count against him, because they’re underpinned by serious methodological flaws — a reliance on determining value from input factors rather than utility, a lack of accounting for opportunity costs.

It doesn’t mean I think Marx is crap — he’s interesting to me in other areas. And what I’m labeling flaws were hardly unique to Marx; they were pretty endemic to economics before Albert Marshall. But it does mean that, at least for what is now understood as mainstream econ, Marshall, or Keynes, or Samuelson, or … have a lot more to say to me.

I am not sure where your claim about Solzhenitsyn’s literary value is coming from.

You’re misreading me. I’m not saying anything about his literary reputation; I have no opinion on it. What I am saying is that, once you get past that — or his role as Gulag Suffering, personified — you’ll find someone who held all sorts of questionable and somewhat offensive ideas. So his endorsement doesn’t mean much to me.

41

Bruce Baugh 10.01.10 at 4:49 pm

It’s not just that Hayek was completely, comprehensively wrong about what social democracy would do to freedom. He also completely missed where tyranny actually does always come from in the 20th century: national security states, the military-industrial complex combined with secret police forces at home. The continuing hosannas from Reason’s editors for the Tea Party are far more representative of the breed than Radley Balko’s struggles for some practical justice.

42

Myles SG 10.01.10 at 4:50 pm

Really? I suppose anything is possible but if you look at the actual evidence the social democratic parties in western countries were never likely to remodel their nations after the USSR. Are you really going to tell me that Tommy Douglas wanted to turn Canada into a totalitarian state? That the CCF was secretly planning to end elections and freedom of the press?

I don’t think the question was what Tommy Douglas (who was recently voted the Greatest Canadian on CBC, and was indeed a very great Canadian and certainly the greatest premier of Saskatchewan) wanted, as much as the movement he assisted in would eventually do out of its own momentum.

Nobody, when the Tea Parties started, thought “we are going to turf out Mike Castle and replace him with a complete dingbat loony, so we could lose a guaranteed Senate seat pickup!” But that’s what happened. Nobody thought “Let’s kick out a solid Republican, Bob Bennett, for trivial reasons!” But that happened also. Revolutions develop their own momentum. The French sans-culottes didn’t start off wanting hundreds of thousands of fellow Frenchmen subjected to the Reign of Terror and executed. But that happened too.

What Hayek was saying is that once we start off on the road to a more collectivist society, the act of becoming more collectivist takes on its own momentum. Sort of like acceleration, really. As the collectivist impulse develops, the speed at which we proceed toward collectivist increases. Which is defensible as an abstract proposition.

Now, the problem with Hayek was that his book was, in a sense, a self-refuting prophecy. There are self-fulfilling prophecies; his was partially self-refuting. It could be argued (although I don’t subscribe to this argument) that it’s precisely because of voices like his that collectivism did not proceed further than it did in the West. It’s a fairly specious argument, I think, but whatever.

In any case, I’m not really interested in the factual verities of Hayek’s book TRTS. They just don’t really matter. As I said, the time has long since passed when the facts in the book were of any real relevance to anyone. Is anyone reading Aristotle for the facts, which he was very prone to getting wrong? With Hayek, as with Aristotle, one has to read for the moral edification and perhaps as a polemic, as a call to arms. No one would seriously hold up the Communist Manifesto and ask if all the facts therein line up; that would just be silly. TRTS is a basically a text de la contre-revolution, and it’s more comprehensible if read as such.

And this is why the whole criticism seems awfully bitter and just plain odd. Would some right-winger hold up the Communist Manifesto and gnash his teeth about how awfully misguided and erroneous the book is? Were someone to do such a ridiculous thing, should we not laugh at him?

43

Myles SG 10.01.10 at 4:56 pm

He also completely missed where tyranny actually does always come from in the 20th century: national security states, the military-industrial complex combined with secret police forces at home.

Lolwut? Yes, the “military-industrial complex”, yessir. Why, Leninism had nothing to do with it! Nor did other dumb ideologies like fascism! Trotsky, who was commissar of the army, yes sir, and was a rather competent killer of human beings himself, yessir, he was just a shill for the military-industrial complex! Nothing to do with ideology, no Sir! Just the institutions that are wrong. No moral agency there. No difference between some half-baked Argentine junta-dictator and Pol Pot.

Is this supposed to be a parody?

44

Jeo 10.01.10 at 4:57 pm

Hopefully they’ll actually read Hayek, instead of putting it on the shelf and believing what Glenn Beck says about it. Then they’ll see that (a) socialized healthcare was A-OK with Hayek, as Myles quoted above, and (b) he was fine with other forms of social safety nets as well.

45

Myles SG 10.01.10 at 5:04 pm

What I am saying is that, once you get past that—or his role as Gulag Suffering, personified—you’ll find someone who held all sorts of questionable and somewhat offensive ideas. So his endorsement doesn’t mean much to me.

Yes, he did go rather off tangent sometimes, like the time when he railed at Harvard students on and on about the Emasculation of Modern Males in Western Societies Because They Are Wearing Long Hair, or something equally bizarre.

But here he’s talking about Russia, and the gulags, and all that; stuff that he knows well, and stuff for the description of which he won a Nobel. He can’t be that far off when he says (my own words) “what Hayek writes in this book, which isn’t about Russia, and despite that Hayek probably has never been to Russia, in fact describes Russia very well.” Which isn’t saying much, because he’s not talking about TRTS in relation to the West, but it does suggest that Hayek is one of those old Whiggish (modern Halifaxian Tories, really) people who had an extremely well-developed intuition for what’s going on and seeing through utopian bullshit, even when very few people did.

46

bh 10.01.10 at 5:17 pm

No, Solzhenitsyn all sorts of stupid, offensive things to say about Russia, too. I wish I had a more upscale reference, but his Wiki page gives a decent summary.

http://en.wikipedia.org/wiki/Aleksandr_Solzhenitsyn#Views_on_atheism.2C_history.2C_and_politics

Oh, and I’m very flattered by you and your fellow genius’s “shorter” version of me. ‘Anti-capitalist’… if you knew my academic (and business!) background…

… to be fair, it’s no dumber than anything else you write.

47

MPAVictoria 10.01.10 at 5:39 pm

Myles if you are going to claim that the CCF had any internal momentum towards totalitarianism similar to the kind practiced by the Soviets I would like some kind of proof.

48

Myles SG 10.01.10 at 5:43 pm

Uhm, the Waffle?

49

Hidari 10.01.10 at 6:02 pm

‘Are you kidding? I’ve heard a number of mainstream economists—on paper, in lectures, in casual conversation—say exactly that. And fwiw, I agree with them to a degree. Marx’s bad predictions should count against him, because they’re underpinned by serious methodological flaws—a reliance on determining value from input factors rather than utility, a lack of accounting for opportunity costs.’

It is a myth (albeit an extraordinarily widely believed myth) that Marx believed ‘the revolution’ (or anything else for that matter) to be ‘inevitable’. It’s certainly true that in the Communist Manifesto, Marx (who was, amongst other things, a politician) claimed that the victory of his party was ‘inevitable’ (which has much the same meaning and force as any politician anywhere telling his/her supporters that victory is inevitable). But that’s very different from stating that Marx was stating a scientific or pseudo-scientific law about ‘historical development’ (cf Popper’s fictitious ‘historicism’).

http://marxmyths.org/peter-stillman/article.htm

http://www.guardian.co.uk/books/2006/jul/08/politics

50

Substance McGravitas 10.01.10 at 6:03 pm

Uhm, the Waffle?

When did the CCF disband? When did the Waffle form?

51

bh 10.01.10 at 6:21 pm

#47 — I avoided ‘inevitable’ on purpose. I’ll stand by ‘prediction’, though.

52

Ken 10.01.10 at 6:27 pm

Myles SG wrote: “And no one claims that Marx is irrelevant simply because he made some whopper predictions.”

Some years ago, back when Usenet News was the hot thing, I was active on the talk.origins newsgroup. At the time, one of the tropes in circulation among the creationists was that Marx, Freud, and Darwin were all alike: nineteenth-century thinkers who were entirely wrong. Also, Marx and Freud had already been overturned by more recent work, and Darwin would be Really Soon Now. So at least back then, there were plenty of people claiming Marx was irrelevant.

I doubt that many of the people who made that claim have changed their minds since – they certainly never changed their arguments in talk.origins, no matter how many times they were figuratively slapped across the face with reality. Now that I come to think of it, there’s an easy way to check. One of the most obtuse was Andy Schlafly, so you could go over to the Conservapedia and see what he thinks about Marx now.

53

Myles SG 10.01.10 at 6:37 pm

Now that I come to think of it, there’s an easy way to check. One of the most obtuse was Andy Schlafly, so you could go over to the Conservapedia and see what he thinks about Marx now.

Well, I am not attempting to argue with idiots, at least not idiots who write he Conservapaedia.

54

MPAVictoria 10.01.10 at 6:47 pm

The Waffle was a movement within the NDP not the CCF. Try again.

55

MPAVictoria 10.01.10 at 6:52 pm

I also would argue the claim that the members of the Movement for an Independent Socialist Canada were trying to create a totalitarian state.

56

Myles SG 10.01.10 at 7:23 pm

The Waffle was a movement within the NDP not the CCF.

And the NDP is a continuation of the CCF. What’s your point?

Wikipedia says, and I quote: “In 1961, at the end of a five-day long Founding Convention which established its principles, policies and structures, the New Democratic Party was born and Tommy Douglas, the long-time CCF Premier of Saskatchewan, was elected its first leader.”

NDP = CCF (the farmers) + organized labour.

57

Myles SG 10.01.10 at 7:28 pm

IN any case, the Hayek debate is a bit bizarre. The people who buy his books in large numbers right now (Glenn Beck’s idiots) are not in any sense Old Whig. It’s all like some weird drama more than anything.

We are essentially debating over a strawman here. It’s not like the readers who catapulted Hayek to his place on the best-sellers are actually going to carefully read his book and have their beliefs changed thereby.

58

Substance McGravitas 10.01.10 at 7:34 pm

And the NDP is a continuation of the CCF. What’s your point?

Here, “oops” would suffice.

59

MPAVictoria 10.01.10 at 7:35 pm

Myles:
It matters because we were talking about the CCF not the NDP. Two different parties with very different constituencies. Also like I said the Waffles are hardly an example of incipient totalitarian urges. The problem with Hayek is his entire argument is based on the false premise of a slippery slope from socialized health care to gulags. Right wingers today make similar, and similarly wrong, arguments about gay marriage leading do marriages between humans and animals.

60

Mrs Tilton 10.01.10 at 7:57 pm

…it’s one of those books whose merit is undiminished by its factual errors…. In such a polemic the facts of his prediction, and his inaccuracy, does not matter. What matters is the moral sentiment of the book. In the same way the modern-day student might read Marx’s work that includes predicting the end of capitalism, despite his errors of prediction, so might a libertarian-minded person read Hayek.

Shorter Myles SG: Yes, TRTS is glibertarian wanking material.

61

Norwegian Guy 10.01.10 at 8:06 pm

Myles,

Trotsky was of course the founder of the Soviet military-industrial complex. The problem with the Soviet Union was that it was a national security states, with a powerful military-industrial complex combined with secret police forces at home. That they had a health care system and a welfare state for their population wasn’t the problem. It was of course a good thing, as it is everywhere.

And the origins of the problems with the Soviet Union was that it started with an armed coup. The Labour Party in the UK was reformist, not revolutionary party. Lenin took power with no consideration of democratic elections. Attlee on the other hand, was elected after democratic elections. That Hayek couldn’t see these differences is strange.

62

dsquared 10.01.10 at 9:25 pm

Alex at 36 is right – like Marx, there’s a lot of good stuff in Hayek. RTS ought to be seen as the equivalent of “the tendency of the rate of profit to fall” – something that was just a clear and simple mistake, and one where there’s reason for debate about the extent to which the mistake is central to the overall analysis, but not something that invalidates the entire analytical approach. In the case of Hayek, the best thing is to just chuck out RTS, pretend he never wrote it and carry on – it’s a little bit more difficult in Marx, but this is mainly due to contingencies of the publishing industry.

63

Sophie 10.01.10 at 9:59 pm

i don’t know about Beck, but isn’t part of the problem that more serious thinkers also rank it extremely highly?
http://fivebooks.com/america-conservatism/leaderboard

64

geo 10.01.10 at 10:04 pm

“the tendency of the rate of profit to fall” … – a clear and simple mistake

I don’t really understand Marx’s theory, so the following may be an entirely off-the-wall question, in which case I hope no one wastes a moment on it. But could it be that the falling rate of profit is like the clearing of labor markets — something that would indeed happen under assumptions that may once have seemed plausible but have turned out not to be, and that it therefore yields some insight into the conditions necessary for avoiding capitalism’s decline and collapse, conditions which we now take for granted but which may not persist indefinitely (eg, the possibility of further primitive accumulation)?

As I say, just asking.

65

piglet 10.01.10 at 10:26 pm

“Attlee on the other hand, was elected after democratic elections. That Hayek couldn’t see these differences is strange.”

Correct me if I’m wrong but I think Hayek (like his contemporary libertarian admirers) wasn’t too concerned about democracy anyway.

66

bh 10.01.10 at 10:34 pm

D-Squared wrote:

Alex at 36 is right – like Marx, there’s a lot of good stuff in Hayek.

What would you suggest as a starting point?

67

dsquared 10.01.10 at 10:58 pm

his correspondence with Keynes (for what it’s worth, JMK gave “Road to Serfdom” a very good review, which just goes to show something or other) is very good.

68

Brett Bellmore 10.02.10 at 12:10 am

“Nobody, when the Tea Parties started, thought “we are going to turf out Mike Castle and replace him with a complete dingbat loony, so we could lose a guaranteed Senate seat pickup!” But that’s what happened;”

Technically, I think you can’t use the past tense until November 3rd. No matter how certain you are the Republicans are going to lose that Senate seat, they haven’t lost it yet.

69

ChrisJ 10.02.10 at 12:43 am

“Technically, I think you can’t use the past tense until November 3rd. No matter how certain you are the Republicans are going to lose that Senate seat, they haven’t lost it yet.”

True. Never underestimate the ability of the Democratic Party to screw things up.

70

Jack Strocchi 10.02.10 at 3:14 am

Pr Q said:

Hayek wanted to make the much stronger claim that the attempt to implement Labor’s policies would necessarily lead to a loss of personal and political freedom.

Actually it was socialism’s curbs to professional freedom that most bothered Hayek. Hayek believed that the competitive social pressure of free enterprise encouraged an independent state of mind.

More generally Hayek, like Mill and Toqueville, was an aristocratic liberal who was worried that democratic welfarism would snuffle out romantic version of individualism that animated his ideology. They had a point, post-modernism turns everyone into candidates for government “bail-out” and who pays the piper calls the tune.

There is no doubt that the strong version of the TRTS – social democracy ushers in political dictatorship – has been refuted. Social democracy, far from paving the way to political tyranny, has been the bulwark of liberal democracy: facilitating the enforcement of minority rights whilst maintaining majority rule.

A weaker version of TRTS is more defensible: social democratic welfare capitalism saps the entrepreneurial spirit and turns citizens into bureaucratic clients and obedient consumers. That is to say, post-modern serfs. The work of Theodore Dalyrmple confirms this in spades.

Worrying about the despotic tendencies of democratic “mass man” was very much a 19thC liberal thing. Hayek took the title of TRTS from a reference to de Toqueville, who was apprehensive about the regimentation of modern society. Mill, Hayek’s other great intellectual hero, fretted about “the tyranny of the majority”. As Roger Kimball points out, bureaucratic welfarism turns citizens into corporate drones:

From Tocqueville, Hayek took both his title and his sensitivity to what Tocqueville, in a famous section of Democracy in America, called “democratic despotism.” Hayek, like Tocqueville, saw that in modern bureaucratic societies threats to liberty often come disguised as humanitarian benefits. If old-fashioned despotism tyrannizes, democratic despotism infantilizes.

But in the the 20thC it was totalitarian parties, rather than social-democratic electorates, that were the most deadly foes of freedom. Its misleading to back-read Orwell’s notion of “Big Brother” into TRTS. Although Hayek encouraged this in order to boost sales, so he can’t complain.

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Jack Strocchi 10.02.10 at 3:24 am

Of course to say that “a weaker version of TRTS is defensible” does not imply that it is true.

The post-war products of bureaucratic wefarism morphed from hippies into yuppies and are now probably running franchises. Not exactly slaves to the machine.

Whilst the rugged individualists of the Tea Party libertarians are all to happy to collect their Social Security cheques and avail themselves of Medicare.

72

Greg Ransom 10.02.10 at 4:10 am

Admit the self-evident.

You haven’t read the book.

And you know nothing of it’s role in changing 20th century history (hint –read Alan Brinkley for a start).

I’m sick of suffing the massive ignorance of the Hayek haters.

73

john c. halasz 10.02.10 at 4:19 am

@64 geo:

In the first place, it’s “the tendential law of the falling rate-of-profit”, not a deteministic “covering law”, hence something that operates dynamically across a number of contexts and system-states, but also something that interacts with other possible tendencies. Secondly, it’s profits-from production that are in question, (which form the basis of all other distributions of surplus-value). Hence the “law” could be expressed through rising financial asset “values”, (compared to potential future realization of the claims they “embody”), and thus short-run raising of accounting profits (and the distribution of the real distributable surplus-product from wages to profits), as financial asset prices, (which are the inverse of yields, i.e. indicate falling future rates-of-profit), lodge an increasing claim on output. (And, of course, there is nothing to imply that such a “law” applies to a single, closed economy, rather than globally). Thirdly, IFAIK the “falling rate-of-profit” is expressed in LTV terms, as the standard of value or, more technically, the numaire, of the system, (since the relative value of commodities must be expressed in terms of some commodity, and gold= money would just be begging the question). Which is not a crazy choice of “value” or numaire. Consider substituting “full employment of all available labor at rates of compensation sufficient to sustain real effective demand”. Conversely, consider the most effective deployment of labor under prevailing technical means and organizational forms under broadly competitive conditions as promulgating the standard of “value” to the system at large and its available extraction of surpluses. Fourthly, the “tendential law” is actually a complex thesis with several components, which may take place variably over time: the increasing technical productivity of capital stocks, which tends to depreciate the “value” of older capital stocks and thus the aggregate rate-of-profit, the tendency toward increasing concentration of capital stocks and thus increasing capital investment to labor and wage ratios, (which, of course, also increases oligopolistic market power and thus rents, which is one countervailing tendency to falling profits, in particular, if not in aggregate), the tendency of increased technical efficiency to “commoditize” output at ever lower output prices, the tendency for profits to accumulate faster than competitive opportunities for new real capital investment to arise, (thus to spill over into financial speculation and “asset” price inflation), and the fundamental asymmetry and lag in distribution of increased productive surpluses between profits and wages, which results in deficient demand and increased unemployment with a private-profit driven system. At some point, within and across cycles, the prognostication was that the really available “forces of production”, i.e. both the available labor pool and the potential technical means of production, would exceed the prevailing “relations of production”. i.e. the ability to monetize output solely on the basis of the private appropriation of profits and the corresponding valorization of extant capital stocks, at which point the whole system of “value”, must collapse, and either be reset through a devaluation of extant real and financial capital stocks, or replaced with some other sort of a system.

Mind y’all, I’m not saying Marx had it all perfectly right and that nothing further need or can be said. But I am saying Marx, with some effort, can be read as quite intelligible within his own terms and framework. And that to treat him as if he’s uttering gross stupidities, is not only unlikely, but ignorant and likely in bad faith. Hence, from @40 above:
“Marx’s bad predictions should count against him, because they’re underpinned by serious methodological flaws—a reliance on determining value from input factors rather than utility, a lack of accounting for opportunity costs.”
Really? Marx had no understanding of input/output matrices and assumed all value derived from raw inputs, (i.e. presumably meaning “unimproved” labor)? (Hence, of course, there would neither be such a thing as “surplus-value”, to be extracted, nor any increment to real distributable surplus product, i.e. technical increases in real output, that would result from the re-production of surplus-value). And so he had no understanding of relative differences in productivity and how investment decisions would drive forward productive increases precisely by “equalizing” the rate-of-profit across firms and sectors under broadly competitive conditions? (Since “opportunity costs” are precisely those that are never actually paid, being theoretical counterfactual conditionals). Maybe such the imputation of such gross stupidities are a boomerang effect, not just of gross misreadings, but of a lack of adequate neo-classical accounts of the economic phenonema under question.

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geo 10.02.10 at 4:27 am

Thank you, John. I agree, I think.

75

Brett Bellmore 10.02.10 at 9:15 am

“True. Never underestimate the ability of the Democratic Party to screw things up.”

An equally valid observation with respect to the Republican party. The massive barriers to third parties in this country, some formal, some informal, enable the two major parties to compete on a “Who screwed up less” basis, instead of a “Who did better” basis. Elections are largely determined by which party screws up worse at the last minute, in as much as they don’t have to worry about another party taking over if they both screw up.

76

garymar 10.02.10 at 9:15 am

@72 Greg Ransom

Admit the self-evident.

You haven’t read the book.

But I have read the book, including the famous paragraph in support of social security and healthcare. Just bought and read it a couple of months ago. As some of the commenters have suggested, it seems to be a talisman for a lot of conservatives, a tribal identifier.

Maybe Hayek was speaking like an Old Testament prophet: repent, or else! If the sinner repents, then of course the predictions do not come true.

There were a couple of nice chapters that worked as a polemic; others seemed weak and confused. I wonder if someone has already done a critical biography (“Hayek and His Times”?) that places the work in a larger historical context. The current conservative idolatry strips the book of any value it might still have.

77

Tim Wilkinson 10.02.10 at 9:17 am

IIRC, the distinctive doctrine I extracted (or constsructed) from TRTS on a strenuously charitable reading was a general political position, viz.:

1. Teh State is essentially other: a Leviathan.
2. It will if unchecked turn despotic rather than benevolently dictatorial.
3. only if some of us are rich can we hope to check this tendency.

To which the main obvious objections are of a ‘who we, white man?’ type:
1: a. democracy might be possible, b. even if not (which is conceding too much), the ‘otherness’ of the state is moot when very many are actually part of it (I’ve never quite worked out the role of popular complicity in the excesses of the USSR’s road out of serfdom), c. even if not (which is conceding even more too much), a Leviathan may be better than nothing for those whose prospects are otherwise nasty, brutish etc.

2. big business interests have a pretty clear tendency to get despotic, while being even less accountable and scrutable than most states, and lacking even the Macchiavellian prince’s rudimentary concern for hoi polloi.

3. see 1,2.

The underlying rhetorical tactic is similar to that of Libertarians claiming that ‘personal liberty’ essentially includes their way of defining/regulating/allocating property rights. The Hayekian twist is to make the connection a contingent (but lawlike) matter of the way teh State will always behave.

Both of these are political rather than policy positions: by which I mean they don’t presuppose a (1) properly-functioning, (2) legitimate legislating body. In fact they deny the possibility of such a body, or at least in H’s case of one existing indefinitely, instead treating property rights as fundamental quasi-constitutional constraints leaving no room for competing legislation.

Nozick-style Libertarians* get there by denying 2: legitimacy, since self-ownership mumble mumble. The Hayekian position sketched denies 1: proper functioning, suggesting that democratic (for example) control cannot prevail over political elites (so we must have, er, business elites to protect us).

*By ‘Nozick-style Libertarians’, I mean pretty much those who are willing to espouse potentially defeasible philosophical arguments. The others comprise: 1. blatant hypocrites and bullshit merchants, 1. proponents of rigidly ‘free’ markets on instrumental grounds, who are obviously wrong and equally obviously dogmatic, and 3. Mises/Rothbard types with their totemic ‘praxeology’, a term of similar status to ‘dianetics’, meaning if anything ‘[a strange flavour of] economic theory carried on as if it involved no normative presuppositions, yet trumped all normative objections’. The last are given to moaning about Nozickian positions being straw men wrongly treated as providing the strongest extant case for libertarianism. Quite the opposite is in fact true: no-one bothers addressing such ‘Austrian’ philosophical positions as can be identified because it’s too easy, not because it’s too hard. (Hans-Herman Hoppe is the current house ‘philosopher’, good for a laugh.)

78

Tim Wilkinson 10.02.10 at 9:23 am

BTW not only unlikely, but ignorant and likely in bad faith @73 is an excellent illustration of why (besides snobbish/aesthetic concerns) I can’t reconcile myself to the US (and spreading) habit of treating ‘likely’ as an adverb.

79

Tim Worstall 10.02.10 at 9:25 am

“I like this concept of “very prescient about where they could have been headed”. Although as far as I can see the words “could have been” ought to be replaced by the word “weren’t”.”

The Ehrlich Defence.

“But Paul, billions didn’t starve like you said they would”

“See! I changed the future with my warnings!”

80

John Quiggin 10.02.10 at 9:40 am

Jack and others, the fact that a lot of people at the time found Hayek’s predictions plausible doesn’t change the fact that they have been proven false, and not because (as some above have implied) the British public heeded his advice and rejected the blandishments of the Labour Party.

As regards my description of Hayek (and Thatcher FWIW), are you saying that he wasn’t enthusiastic about Pinochet, or that Pinochet wasn’t a mass murderer? The point about “marginal historical interest” was a specific reference to TRTS, regardless, as I said, of what might be thought about Hayek’s work in general.

81

sg 10.02.10 at 9:52 am

To me, the fact that a lot of “great thinkers” honestly believed that universal healthcare would end in tyranny, and Atlee et al pursued it anyway, is a huge complement to them (if they needed any) and to their legacy.

The NHS is now far and away one of the worst universal health systems, which is undoubtedly why the far right in the US select it as the comparator when they do their scare campaigns, but I wonder if their decision to target the NHS isn’t also driven by this simple fact – Hayek, their god, was completely and utterly wrong, and the NHS is the reason that he looks like a sad nutsack.

82

Chris Bertram 10.02.10 at 10:28 am

_is now far and away one of the_

Does that even make sense? It could be far and away the worst universal health system, though I doubt that it is unless you narrow the comparison class somehow. But “one of the” implies that there are others in the same boat, and contradictes the “far and away”.

83

Robert 10.02.10 at 10:48 am

I think those wanting to read worthwhile Hayek might start at Individualism and Economic Order. “Worthwile” means “interesting”, independently of whether it is mostly right or wrong. Some of The Road to Serfdom is a popularization of some of the themes in Individualism and Economic Order. So good and bad Hayek aren’t easy to seperate.

Correspondence with Keynes is collected in volume 9, Contra Keynes and Cambridge, of Hayek’s collected works. I find some aspects of Austrian Business Cycle Theory other than completely wrong. But I would recommend that the general reader leave ABCT to technically-oriented heterodox economists and historians of thought.

Selected good points of ABCT: Hayek, like Keynes, realized an adequate monetary theory requires reconstructing price theory. Hayek and his student Lachmann define equilibrium as a state where plans are coordinated and expectations are being realized. As with Joan Robinson, this approach has important implications for capital theory.

I think Hayek’s statements in the 1970s and 1980s are not any more authoritative for understanding The Road To Serfdom than anybody else. Hayek did, unfortunately, support Pinochet. Going by The Fatal Conceit, Hayek did not like hippies. His earlier work suggests social experimentation would be a good thing, but then saw the 1960s.

84

novakant 10.02.10 at 11:17 am

Hayek wanted to make the much stronger claim that the attempt to implement Labor’s policies would necessarily lead to a loss of personal and political freedom. (…)

the fact that a lot of people at the time found Hayek’s predictions plausible doesn’t change the fact that they have been proven false

Well, necessarily or not, Labour’s policies have lead to a significant loss of personal and political freedom – Hayek’s reasoning might have been wrongheaded, but his predictions weren’t all that far off. Maybe Miliband will reverse the course, but I’m not holding my breath.

85

John Quiggin 10.02.10 at 11:33 am

Even for you, Novakant, this is a startlingly silly claim. Among the many achievements of (old) Labour were accession to the European Convention on Human Rights, abolition of the death penalty, legalisation of homosexuality etc etc.

Renewed restrictions on human rights started with Thatcher (one side of a mutual admiration pact with Hayek) and have continued under her successors, all openly hostile to the ideas advocated by Attlee and criticised by Hayek.

86

Rex 10.02.10 at 11:49 am

How unsurprising that idiot Ransom has poppoed up here. Taking everyone else to task for hating Hayek and not having read Hayek while he never gets around to actually publishing anything on Hayek to tell people how it is. No wonder the Austrians think him such a jackass.

87

Jim Rose 10.02.10 at 11:58 am

john quiggin,
various people say things they should regret ever saying and their friends and admirers regret that they said it at all.

There are plenty, now on the left and the right, who in the past, and sometimes too recent past, dabbled in ideologies that did not include an unwavering commitment to democratic government, the rule of law, and peaceful change through the ballot box.

Ex-communists: they are allowed back into polite society and into left-wing political parties often without have to admit and openly repent for being the fools that they were. Some of these ex-communists took a long time and were well past their immature youth to see the foolishness of their ways.

The forgiveness for ex-communists is odd as Hayek in the Road to Serfdom challenged the general view that fascism was a capitalist reaction against socialism. Hayek instead arguing that fascism and socialism had common roots in central economic planning and the power of the state over the individual.

Hayek noted that the inter-war communists hated the Fascists because both competed for working class support and because ex-comrades such as Mussolini had worked out that co-opting nationalism with anti-big business rhetoric was a sure path into the hearts of the working class, lower-middle class, and small business and it greatly increased their chances to seize power quickly and legally with wide support in times of discontent.

The economist Joan Robinson gazed on China and North Korea with “starry eyes”, as Geoffrey Harcourt put it, as well as making some utterly devastating criticisms of Marxian economics at earlier points in her long career. Robinson became more left wing as she aged, and in Economic Management in China (1975), she praised the Cultural Revolution! Her colleagues were quite embarrassed.

Noam Chomsky spoke when he should have listened on Cambodia under Pol Pot.

Orwell’s Proposed Preface to ‘Animal Farm’ is a wonderful dissection of what he called renegade liberal who glorified communist experiments from a safe distance.

For Orwell, these intellectuals loved Stalin’s Soviet Union despite the purges, mocked bourgeois liberty despite their own pleasing bourgeois circumstances, and identified with communists would who have shipped them off to camps straight after the revolution.

These renegade liberals – who were life-long opponents of capital punishment – excused the Moscow purges because communists were just ‘liberals in a hurry’.

At least one of the chief designers of market socialism, Oskar Lange, was principled enough to renounce his American citizenship and returned to Poland in 1945 to climb his way up the ranks of a Stalinist centrally planned economy for the next 19 years.

88

Tim Worstall 10.02.10 at 12:28 pm

“Well, necessarily or not, Labour’s policies have lead to a significant loss of personal and political freedom – Hayek’s reasoning might have been wrongheaded, but his predictions weren’t all that far off.”

Hayek’s reasoning was certainly extreme but wrong would be putting it too strongly. It’s a constant and repeated theme in UK politics at the moment that because smoking/drinking/whatever costs the NHS money therefore the State has the right to curtail the liberty to smoke/drink/whatever (“whatever” increasingly including stuff your face with burgers for example).

There are all sorts of reasons why you shouldn’t smoke/booze/whatever, as well as reasons why you may want to. But that very argument that you shouldn’t because it costs the NHS cash is indeed the sort, if not to the extent, of thing that Hayek was suggesting would happen.

89

Myles SG 10.02.10 at 12:43 pm

Does that even make sense? It could be far and away the worst universal health system, though I doubt that it is unless you narrow the comparison class somehow. But “one of the” implies that there are others in the same boat, and contradictes the “far and away”.

This smells awfully bad. Someone noted that the NHS is a particularly crappy version of an universal health care system, and in response you pick on the semantics.

In any case, I don’t think the right-wing use of the NHS as bogeyman in the U.S. is that complicated. It’s just a really crappy system! A system that refused to pay for some particularly expensive drugs only several years ago! etc. etc. etc. There’s no need to get grandly historical; the right-wing in the U.S. is too full of idiots for one to need to ascend the heights of historical analyses.

And if one limits the frame of reference to a comprehensible and reasonable one (i.e. advanced Western economies in Europe and North America), there’s probably not much doubt that NHS is the worst universal system. I do wonder how many of the CT’s UK contributors opt for Harley Street rather than NHS.

90

Myles SG 10.02.10 at 12:44 pm

The last sentence, my apologies, was meant in jest.

91

novakant 10.02.10 at 12:46 pm

I was talking about “New” Labour, which, I hope we can all agree, has a an atrocious human/civil rights record.

92

bianca steele 10.02.10 at 1:42 pm

TW @ 77:
I would add:

4. These conclusions are the product, not of my prejudices and those of my relatives, but of My Serious Research (and this does NOT derive ultimately a complaint about my great-uncle’s loss of a lawsuit to a man who held local political office).

5. My research is based on societies that actually don’t impose serfdom on people unlike me.

Perhaps (5) is true. I’d bet (4) is false. This just isn’t how we understand serious research into society and history to be done. Grant the genius of Hayek’s detailed work on economic theory. Grant the usefulness of his writings as a very clear example of a particular strand of thought. Don’t pretend they are “science” rather than opinion. These writings are no better than Ayn Rand for what they actually teach.

93

bianca steele 10.02.10 at 1:45 pm

Jim Rose makes some very good points. I assume, though, that when he says “ex-communists,” he means in countries formerly governed by communist governments. In the United States, ex-communists who joined the Right could re-enter politics respectably. Almost no ex-communists that I can think of remained in political life except to the extent that they devoted their future careers to attacking communism.

94

Tim Wilkinson 10.02.10 at 1:45 pm

@90 quotes are around the wrong word

95

Greg Ransom 10.02.10 at 2:49 pm

Leftist historian Alan Brinkley has done this. He’s not an ignorant hack like Quiggin

” I wonder if someone has already done a critical biography (“Hayek and His Times”?) that places the work in a larger historical context. The current conservative idolatry strips the book of any value it might still have.”

96

Greg Ransom 10.02.10 at 2:55 pm

I’m saying he wasn’t.

” are you saying that he wasn’t enthusiastic about Pinochet?”

We know Hayek was deeply ignorant of what Pinochet had done.

And he never praised or endorsed Pinochet.

He did endorse getting rid of communists.

Hayek never endorsed Hitler, but he was also for keeping communists from taking over governments.

Theremis no contradiction — as Stalinsts sometimes wish to suggest (unless they don’t).

97

Greg Ransom 10.02.10 at 3:04 pm

Here’s Brinkley (major U.S. historian & left intellectual):

Alan Brinkley* (History, Columbia)

“The publication of two books .. helped to galvanize the concerns that were beginning to emerge among intellectuals (and many others) about the implications of totalitarianism. One was James Burnham’s The Managerial Revolution .. [A second] Friedrich A. Hayek’s The Road to Serfdom .. was far more controversial — and influential. Even more than Burnham, Hayek forced into public discourse the question of the compatibility of democracy and statism .. In responding to Burnham and Hayek .. liberals [in the statist sense of this term as used by some in the United States] were in fact responding to a powerful strain of Jeffersonian anti-statism in American political culture .. The result was a subtle but important shift in liberal [i.e. American statist] thinking.”

98

cce 10.02.10 at 3:37 pm

In the event that not all are aware, Greg Ransom runs a blog dedicated to Hayek worship.

99

Nick 10.02.10 at 3:51 pm

That was my reading of RTS too. It feels like much more of an ideological analysis than work of political economy. The ‘inevitability’ of authoritarian collectivism was in the minds of many intellectuals who were still very much in admiration of communism just after ww2. Hayek took part in a project thathighlighted not just the disadvantages of authoritarianism but the fact that it was self defeating in terms of the goals that the left had. Unlike a Marxian prediction, hayek’s concern was with an intellectual current rather than a material development.

And btw, the nhs is still shit compared to many of it’s market oriented cousins in Europe. It never covered treatment from cradle to grave as promised but it did make a number of doctors filthy rich. And it’s not even anymore equitable than more competition based systems.

100

stubydoo 10.02.10 at 4:32 pm

Hayek was not attempting to predict the future of Britain – he was just describing some reasons for being concerned. His assessment of the situation can be readiliy rescued by attributing the fact that Britain turned out all right to the diminishing influence of Socialist thought. Hayek’s fan can just thank their lucky stars that one of them won the 1979 election. I’m sure you guys could tell me several good reasons why all of that is wrong, but sadly you don’t have the counterfactual history on hand to make it watertight.

Where The Road to Serfdom stands or falls is not as a chrystal ball for post-war Britain (making predictions is very difficult, especially about the future), but as a story about how the development of Naziism was a natural consequence of the intellectual developments of socialist thought. An ambitious project to be sure (the current mainstream regards this as ridiculous on it’s face). And The Road to Serfdom is not such a long book. And its author was an economist by trade. Thus, for current readers without other knowledge of what he was talking about it can only work as preaching to the choir. But that does not make it wrong.

I’d be much more likely to be persuaded of the uselessness of the book by an attack directed at this aspect than by someone pointing out that the dystopia that Hayek was worried about hasn’t happened yet in the specific place he was concentrating on. After all, it did happen in Cuba, and something like it looks to be happening now in Venezuela without the confounding factor of Soviet influence (sure, the leftist mainstream is happy enough now to distance itself from Chavez, but a few years ago not so much – oooh, and can we turn this into an argument about how popular Mao used to be).

101

john c. halasz 10.02.10 at 4:32 pm

@78:

Whaa?

http://www.merriam-webster.com/dictionary/likely?show=1&t=1286036910

Is this just one of those things like Orwell’s claim that Americans think there is no “t” in “water”?

102

Steve LaBonne 10.02.10 at 4:54 pm

And btw, the nhs is still shit compared to many of it’s market oriented cousins in Europe.

That’s a complete gibbertarian crock of shit. It is perhaps the most efficient health care system in the world. It manages to produce OECD-average health outcomes at quite a bit below-average cost (some might say, at starvation levels of funding.) If it were funded at the average level of European systems, whatever quality deficiencies it currently exhibits would vanish.

Leaving the pathological US case aside, the market-oriented Swiss and German systems are among those providing the least bang for the buck. They produce good care by consuming a lot of money. I doubt very much that they are the wave of the future, because the way health care economics works has nothing do with the gibbertarian fantasy world, and REQUIRES heavy government intervention to keep costs under control.

103

sg 10.02.10 at 5:12 pm

Worstall, if you think what the NHS wants to do with fat people is bad, try privatising it and see what happens.

Chris B, please try to relax. Everyone knows the NHS is bad, probably the worst. It’s not necessarily the NHS’S fault; but cheap gotchas over a poor choice of words doesn’t change the facts.

104

Tim Wilkinson 10.02.10 at 5:17 pm

jch @99 – I was going to ask if it had got into US dictionaries yet. I’m pretty sure it hasn’t been for very long, and I would guess it’s not in UK ones but soon(ish) will be. Thing is, ‘ly’ at the end is an adjectival ‘-ish’ rather than an adverbial ‘-wise’. It’s certainly unseemly.

Sorry to pick your peg to hang my huff on; it’s just that the quoted phrase nicely illustrates the fact that this is a (new? I’m having doubts now) source of ambiguity.

FWIW, in conciliatory vein, your comment itself seemed rather good. I like ‘tendential’ – rather better (in adjectival rather than adverbial positions) than the hopelessly weak ‘ceteris parabus’ (q.v. all economists), the inappropriately epistemic ‘prima facie’ (e.g. Ross’s p.f. duties) or the tortured ‘pro tanto’ , though the last may still be the least bad option in adverbial position; see David Wiggins, Needs, Values Truth. postscript, 2.1 (‘it is pro tanto unjust’ ). He cites Bernard Williams ‘Consistency and Realism’ (against ‘prima facie’), Susan Hurley, ‘Conflict, Akrasia and Cognitivism’, pp23ff (for ‘pro tanto’). It may not quite be there yet – I’ve been trying to work out a good phrase (most recently needed to describe Hayek’s ideas about state despotism preventable only by the bastion of private wealth) of something that will definitely happen unless some of a reasonably well-defined range of opposing factors intervene.

Anyway, sorry, but ‘likely’ as adverb jars me to a halt every time I read it, even after many encounters. ‘Probably’ really isn’t that much of a mouthful.

It’s not for me to leglislate the language, but I may do the equivalent of walking around in sandwich boards shouting. Which I have now done. The end is nigh. You heard it here last.

105

Tim Wilkinson 10.02.10 at 5:18 pm

‘paribus’, of course.

106

Tim Wilkinson 10.02.10 at 5:43 pm

Studyboo @98. Who are you kidding? The Conservative party have always been hand in glove with the military, police and Those In Between. (Labour by contrast had been extensively spied on and conspired against by the security boys.)

Thatcher took a newly authoritarian direction (abuse of ‘sus’ law, PACE, Public Order Act 86, Official Secrets Act 89. Mandatory seatbelts were a precursor of subsequent paternalist stuff from subsequent Thatcherite administrations, like the smoking ban. (BTW the NHS costs argument is not the motivation for the smoking ban. In fact, I’d have thought the net effect on NHS costs of smoking is negative, quite apart from high indirect taxation, supposedly deterrent (but actually just exploitative of extremely inelastic demand, i.e. precisely not deterrent). And in terms of practical individual security, Thatcher’s tenancy reform was a disaster for the plebs. That’s off the top of my head.

107

john c. halasz 10.02.10 at 6:06 pm

@102:

To my American ears, there’s no problem with “likely” adv. So your criticism seems only valid as a point of style, not syntax or semantics. To which I’ll readily plead guilty. But, for the rest, it might be rather like the difference between the British and American use of “quite”, which is quite confusing.

My analogous pet peeve is the spreading use among the younger American generation of “was like” in place of “said”, as in he was like, “…”. If I’ve divined the origins or sense of the usage, it amounts to substituting the attitudinal or illocutionary component of quoted speech for its propositional content.

108

john c. halasz 10.02.10 at 6:43 pm

For those claiming that Hayek’s work is a polemical analysis of the origins of fascism in socialist tendencies and thus an upholding of free markets as a bulwark and bastion of liberty, in opposition to fascism, it’s worth noting the Karl Polanyi’s “The Great Transformation” was in part a polemic against Austrian school market liberalism, as having caused the social disruption that gave rise to fascist reaction. (Polanyi had been a top editor at the Viennese equivalent of the WSJ, until he was fired for his political views after the right-wing coup in the early 1930’s, so he was intimately familiar with the views whereof he spoke).

At any rate, it’s worth noting the peculiarly Austrian context for the emergence of the school, which combines a defense of pure laissez faire market liberalism, (such that any failings of the market are due to their never being “pure” enough), with a hierarchical conservatism, such that markets then become bastions of “liberty”. On the one hand, this Austrian brand of conservatism is “grounded” somewhat paradoxically in a more-than-Humean moral skepticism. On the other hand, the advocacy of “free” markets in hierarchical, bureaucracy-ridden Austria amounts to a form of utopianism. (And it’s worth noting that Austrians are not Germans: Anglophilia was a common, fashionable attitude/pose among the educated classes). But these peculiar accents tended to be lost or transformed in their pre-destined Anglo-American translation.

109

Hidari 10.02.10 at 6:58 pm

#105/106

FWIW the specifically Austrian roots of…er…Austrian economics tend to be lost site of. Whatever one thinks of it, its intellectual roots are very different from the standard ‘neo-classical’ (i.e. Anglo-American) approach, although these differences are generally ignored by the Americans who continue to trumpet the wonderfulness of Hayek (and the Austrian school generally).

The paper here is good on the links, for example, between Wittgenstein and the Austrians. One mustn’t forget that the Austrian school was created in opposition to the Historical school and the issue there was really to what extent economics was to become an empirical science. Later on Hayek moved away from ‘praxeology’ to a more Popperian approach, but then Popper was always a lot more Austrian himself than was generally understood in the US/UK.

110

Myles SG 10.02.10 at 7:37 pm

And in terms of practical individual security, Thatcher’s tenancy reform was a disaster for the plebs.

Lolwut? I think we are talking about negative liberties here, are we not? Isn’t liberty at times diametrically in conflict with “practical security”? That the “practical individual security” of airport screenings do reduce liberty?

So when you say “in terms of practical individual security, Thatcher’s tenancy reform was a disaster for the pleb” you are not really making any point with regards to liberty. You are just contending that Thatcher increases the “plebs'” (as you so charmingly put it) liberty at the expense of their “practical individual security.”

Now I understand that you would protest that by “security” you actually meant “liberty”. But perhaps it’s revealing that you did use the construction “practical individual security”. Once you add “practical” to the discussion of negative liberties, it turns into a discussion of positive liberties. For what is universal healthcare, but a form of “practical liberty” from the vagaries of life?

111

Myles SG 10.02.10 at 7:39 pm

In any case, the philosophical origins of publicly provisioned housing in the U.K. are to a degree feudal and paternalistic (and not in just the glibertarian sense; there was a distinct impulse of “we toffs ought to look after the lower classes because they can’t look after themselves” in it).

112

Myles SG 10.02.10 at 7:52 pm

Chris B, please try to relax.

It’s a bit hard to restrain oneself from snark when such golden opportunities present themselves. But I shall try.

113

piglet 10.02.10 at 8:02 pm

“There are all sorts of reasons why you shouldn’t smoke/booze/whatever, as well as reasons why you may want to. But that very argument that you shouldn’t because it costs the NHS cash is indeed the sort, if not to the extent, of thing that Hayek was suggesting would happen.”

Yawn. That’s weak even for Worstall standards. If social democracy is problematic because it may restrict drinking and smoking, could you explain why the proudly non-socialdemocratic country across the Atlantic, aka the land of the free, is so far ahead of both Old and New Europe with respect to restricting drinking and smoking?

114

novakant 10.02.10 at 9:38 pm

#93 you have a point there, lol

115

Lee A. Arnold 10.02.10 at 9:55 pm

Road to Serfdom is an unfortunate bestseller because its has little useful to say to us today. Hayek’s main argument is that total economic planning will fail, or require a police state. His real topic is something like Stalinism. But his current readers take the wrong message from this. Obamacare is not a centralization, and it is nothing to be worried about. The current system doesn’t work, and if Obamacare doesn’t help, we’ll change that too. There is no slippery slide into socialism, as long as there is freedom of speech and democracy. And we’re not giving that up, because Lady Gaga won’t let us. Consequently, attempts to improve policy cannot possibly lead to “less freedom” in the U.S., except in fantasy and delusion.

Hayek has nothing to say about current problems beyond Stalinist third world dictatorships. Nothing at all. He never addressed a major problem of our change: that corporations could grow to a size that presents us with all the problems of governments, indeed capturing government almost entirely, while their R&D departments would provide nearly 100% of all material innovations, so middle-class incomes would begin to stagnate in the midst of increasing productivity and increasing standard of living (we should call this the Schumpeterian question). He never addressed the possibility of ecosystem failure: that the rates of technological innovation and resource substitution might not stay ahead of the rates of depletions of ecological goods, sinks, and services, particularly with high population growth (the Sustainability question). He never addressed the problem of what to do when financial trade grows to ten times real goods and services, changing the values of the currencies, and when gambling in the financial casinos grows to the point of allowing huge personal incomes and social influence without the production of real goods and services, while occasionally threatening the entire accounting system of banks and credit (I say we call this the Phil Gramm flimflam, though he is historically a late entry amongst the swill-givers).

We could absolve Hayek of some of the charges if we suppose that some of these developments were truly obvious only by the end of his era.

But, worse for his continued relevance, Hayek possessed an incomplete epistemology of information in systems. It doesn’t explain what is currently going on.

He supposed, correctly, that a unified central authority could not assimilate to itself all the knowledge that individuals use in their decisions and innovations. Excellent! But he failed to see that the obverse is also true: that individual information is limited by the finiteness of the personal attention span, and meanwhile the complexity of the system might cause environmental and social negative externalities to accelerate, due to the networks effects of the growing number of connections — and thereby necessitating the increasing growth and spread of overlapping, more centralized contexts and institutions, to make up for the all the individuals’ lacks and laxities.

Indeed the ignorance of libertarians in particular regarding the facts of, say, global warming, or the increasing polarization in the size distribution of income, is becoming a dependable illustration of the finiteness of attention spans from among some of Hayek’s most ardent admirers.

Consumers must be informed, to demand correct prices, since prices are determined not only by supply but by demand. Therefore in our times, consumers need to understand wildlife ecology, pesticide chemistry, Chinese labor conditions, testimony from consumer groups and legislative committees, and a host of other elaborate and abstruse areas of knowledge, merely to be truly informed consumers at the grocery supermarket. the next time you go there! Obviously we can’t do this, we simply don’t have the time. In a phrase: our attention spans are smaller than the extent of the market. But then if so, it cannot be said that the spontaneous order is best. It might be a slow fatal disorder.

Therefore I think “spontaneous order” is perhaps Hayek’s least useful category, because it doesn’t lead to more useful distinctions: (1) all the elements of it were introduced for “planned” reasons long ago, (2) the “adaptations” which then moved it to “spontaneous” status cannot automatically be separated from “maladaptations” and “addictions” (“addiction” in Bateson’s evolutionary ecological sense of an evolutionary cul-de-sac), and (3) new planned responses may become necessary.

116

Nick 10.02.10 at 10:57 pm

‘Yawn. That’s weak even for Worstall standards. If social democracy is problematic because it may restrict drinking and smoking, could you explain why the proudly non-socialdemocratic country across the Atlantic, aka the land of the free, is so far ahead of both Old and New Europe with respect to restricting drinking and smoking?’

In a word, progressivism. All the joys of paternalism with less than half of the social protection! the US is certainly no libertarian paradise.

117

Jack Strocchi 10.02.10 at 11:08 pm

Pr Q @ #80 said:

Jack and others, the fact that a lot of people at the time found Hayek’s predictions plausible doesn’t change the fact that they have been proven false, and not because (as some above have implied) the British public heeded his advice and rejected the blandishments of the Labour Party…The point about “marginal historical interest” was a specific reference to TRTS,

I’ve said a number of times that “the strong version of the TRTS – social democracy ushers in political dictatorship – has been refuted” by subsequent empirical events. But it is misleading to consider Hayek’s theory solely in the light of the British Labor government, without reference to the earlier history of National Socialism and International Communism.

A limited, but deeper, implication of Hayek’s model is that socialist economy is the basis for totalitarian polity. This theory is of more than “marginal historical interest”, irrespective of the actual and existing politics of social-democracy. It impressed “a lot” of prescient social analysts – Orwell, Schumpeter, Burnham and Keynes were not just any old “people”! –

Friedrich & Brzezinsksi concluded that socialist command economy is a necessary, though not sufficient, condition for totalitarianism. The (further) sufficient condition for totalitarianism is a dictatorial polity run by a monopolistic party eg Nazi, Bolsheviks etc.

Pr Q said:


As regards my description of Hayek (and Thatcher FWIW), are you saying that he wasn’t enthusiastic about Pinochet, or that Pinochet wasn’t a mass murderer?

Yes, that is exactly what I am saying. It is false to state that Hayek was “enthusiastic about Pinochet” in general, and his “mass-murdering” in particular. Hayek did not have a positive preference for military dictatorship or political murder.

He stated a preference for a “liberal dictator to democratic government lacking liberalism”. He saw the former as a lesser evil to “totalitarian democracy”, a lethal political tendency he traced back to the French Revolution, traces of which he detected in the Chilean upheaval.

I can understand this preference, without wholly justifying it, given the way Pinochet deliberately tipped Chile headlong into economic chaos, on only 1/3 of the vote. Whilst fanning the flames of Maoist revolutionaries waiting in the wings. Pinochet was a nice man but he did himself or the cause of social democracy no favours by this reckless behaviour.

Hayek also hoped and expected “that in Chile, for example, we will witness a transition from a dictatorial government to a liberal government”. Which is about as far from “enthusiastic support” of dictatorship as one can get without expressing outright opposition.

118

Tim Wilkinson 10.02.10 at 11:25 pm

@108: it’s revealing that you did use the construction “practical individual security”

well, perhaps it’s revealing of the fact that I say what I mean.

Shorter @109: ” “

119

Greg Ransom 10.02.10 at 11:38 pm

These are not Hayek’s words — which are lost to us.

This “quote” is a product of a translation “telephone game”.

This is an English translation of a Spanish translation of an interview originally conducted in English. This is a translators interpretation twice over.

“liberal dictator to democratic government lacking liberalism”

120

Greg Ransom 10.02.10 at 11:48 pm

The Hayek hypothesis and the Hayek-Friedman hypothesis wer novel arguments 70 years ago. Today they are mainstream, accepted even by leftist like Barack Obama (do a Google search).

Such massive changes are part of the legacy of TRtoS.

The focus on BS interpretations of claims which are not in the book are and disgrace — and tell us good deal about the significance of misdirection and mythmaking to leftists.

121

Lee A. Arnold 10.03.10 at 12:07 am

Road to Serfdom is an unfortunate bestseller because its has little useful to say to us today. Hayek’s main argument is that total economic planning will fail, or require a police state. His real topic is something like Stalinism. But his current readers take the wrong message from this. Obamacare is not a centralization, and it is nothing to be worried about. The current system doesn’t work, and if Obamacare doesn’t help, we’ll change that too. There is no slippery slide into sozialism, as long as there is freedom of speech and democracy. And we’re not giving that up, because Lady Gaga won’t let us. Consequently, attempts to improve policy cannot possibly lead to “less freedom” in the U.S., except in fantasy and delusion.

Hayek has nothing to say about current problems beyond Stalinist third world dictatorships. Nothing at all. He never addressed a major problem of our change: that corporations could grow to a size that presents us with all the problems of governments, indeed capturing government almost entirely, while their R&D departments would provide nearly 100% of all material innovations, so middle-class incomes would begin to stagnate in the midst of increasing productivity and increasing standard of living (we should call this the Schumpeterian question). He never addressed the possibility of ecosystem failure: that the rates of technological innovation and resource substitution might not stay ahead of the rates of depletions of ecological goods, sinks, and services, particularly with high population growth (the Sustainability question). He never addressed the problem of what to do when financial trade grows to ten times real goods and services, changing the values of the currencies, and when gambling in the financial casinos grows to the point of allowing huge personal incomes and social influence without the production of real goods and services, while occasionally threatening the entire accounting system of banks and credit (I say we call this the Phil Gramm flimflam, though he is historically a late entry amongst the swill-givers).

We could absolve Hayek of some of the charges if we suppose that some of these developments were truly obvious only by the end of his era.

But, worse for his continued relevance, Hayek possessed an incomplete epistemology of information in systems. It doesn’t explain what is currently going on.

He supposed, correctly, that a unified central authority could not assimilate to itself all the knowledge that individuals use in their decisions and innovations. Excellent! But he failed to see that the obverse is also true: that individual information is limited by the finiteness of the personal attention span, and meanwhile the complexity of the system might cause environmental and social negative externalities to accelerate, due to the networks effects of the growing number of connections—and thereby necessitating the increasing growth and spread of overlapping, more centralized contexts and institutions, to make up for the all the individuals’ lacks and laxities.

Indeed the ignorance of libertarians in particular regarding the facts of, say, global warming, or the increasing polarization in the size distribution of income, is becoming a dependable illustration of the finiteness of attention spans from among some of Hayek’s most ardent admirers.

Consumers must be informed, to demand correct prices, since prices are determined not only by supply but by demand. Therefore in our times, consumers need to understand wildlife ecology, pesticide chemistry, Chinese labor conditions, testimony from consumer groups and legislative committees, and a host of other elaborate and abstruse areas of knowledge, merely to be truly informed consumers at the grocery supermarket. the next time you go there! Obviously we can’t do this, we simply don’t have the time. In a phrase: our attention spans are smaller than the extent of the market. But then if so, it cannot be said that the spontaneous order is best. It might be a slow fatal disorder.

Therefore I think “spontaneous order” is perhaps Hayek’s least useful category, because it doesn’t lead to more useful distinctions: (1) all the elements of it were introduced for “planned” reasons long ago, (2) the “adaptations” which then moved it to “spontaneous” status cannot automatically be separated from “maladaptations” and “addictions” (“addiction” in Bateson’s evolutionary ecological sense of an evolutionary cul-de-sac), and (3) new planned responses may become necessary.

122

Jim Rose 10.03.10 at 12:10 am

Bianca Steele,
I meant individuals who were ex-communists, not ex-communist countries.

1960s radicals in the U.S. Democratic Party are more common than you think.

Did not Obama start his political career in 1995 with a deeply unfortunate and totally misrepresented association with unrepentant Weathermen terrorist, now renegade liberal and 1997 Chicago Citizen of the Year William Ayers? Obama lost his first primary race in 2000 to an ex-member of the Black Panthers Party and convicted felon, Bobby Rush.

I was also not talking about, for example, the Militant tendency, which was an entrist group within the British Labour Party from 1964.

The Militant tendency described its politics as descended from Karl Marx, Friedrich Engels, Vladimir Lenin and Leon Trotsky. In 1972, the British Labour Party conference passed a Militant tendency resolution which committed the next Labour government to introduce “a socialist plan of production based on public ownership”.

Australian communists also tried entrist tactics into the Australian Labor Party, if former PM Paul Keating and others are to be believed.

Several Green MPs in the NZ parliament spoke with pride in their maiden speeches about their times as communists and Trotskyites and how they did not regret their sometimes not too distant past but just instead decided to pursue their goals by other means. One Green MP back in his Trotskyite days had even supporting the Soviet invasion of Afghanistan! He is now against US invasions anywhere.

The first Australian green federal MP and one new green senator in the recently elected Australian federal parliaments were proud communists. I do not know if they plan to repented and repent again for their poor past choices in their upcoming maiden speeches. I will keep you informed.

Sue Bradford, an NZ Green MP (1999-2009), was in the late 1980s a member of Workers Communist League, then joined the new labour party formed in 1989 by Jim Anderton – who was deputy NZ PM by 1996 – and a green party member in 1990. Bradford wanted to turn the greens into a voice for the working class.

the Eco-socialist Sue Bradford NZ Green MP (1999-2009) was in the late 1980s, a member of Workers Communist League, then the new labour party formed by Jim Anderton – who was deputy PM-in1996 – and a green party member in 1990. she wanted to turn the greens into a voice for the working class.

Ever heard of the term watermelons as a description for the politics of some members of the Greens?

123

Jack Strocchi 10.03.10 at 12:38 am

The attempt to portray Hayek as a crypto-fascist looks desperate and unconvincing, especially when measured against the testimony of those who actually knew him and who lived through that turbulent era. We have this on the authority of no less a figure than Paul Samuelson, who provides a balanced and worldly interpretation of Hayek’s former and latter-day rants:

…Exactly what I have written above evaluating The Road to Serfdom is precisely what I believed about it in the 1940s and continued to believe about it up to the present 2007…the “serfdoms” believed to have occurred in accordance with Hayek’s 1940 crystal ball are not at all the Nazi-Burma-Mao-Castro totalitarian catastrophies…Instead they are the mixed economies that have flourished almost everywhere in the post-1945 years!

Consider only Sweden’s fig-leaf middle way. As I write in 2007, Sweden and other Scandivanian places have somewhat lowered the fraction of GDP they use to devote through government. But still they are the most “socialistic” by Hayek’s crude definition. Where are their horror camps? Have the vilest elements risen there to absolute power? When reports are compiled on “measurable unhappiness,” do places like Sweden, Denmark, Finland and Norway best epitomize serfdoms? No. Of course not.

But Samuelson knows that its a little unfair to judge Hayek by cranky remarks he made in his doddery old age. To put it bluntly, Hayek suffered from cardio-vascular disease which made him go a bit funny in the head when his political temper was aroused:

…So it was when I began to receive complaints from my long-time acquaintance Friedrich Hayek. Why at so late a date should I belabor the persisting differences between us on ideological issues? No good deeds go unpunished!…Never then, or before, or later did I have reason to think or to say: “Yes, I have misunderstood you. Yes, I have incorrectly quoted from you. Mea culpa.”

Hayekian biography confirms a few commonplaces…. Once he told me (and I quote from memory) that (in his seventies) he feared he had become stale and uncreative. But later his originality did come back. In hindsight he learned that his two periods of letdown [in the forties with TRTS and in the seventies with Pinochet] in fact turned out to have coincided with two incidents of heart infarction.

…one must learn to appreciate that elderly friends do need to be handled gently…“That’s not…[him] arguing. It’s his arteries. Let’s just go with the flow and remember [his] fertility and admirable versatility.”

…Why agitate ourselves when we are each entitled to harbor different analyses? One learns that often it is better to avoid an argument than to win one. Amen.

This charitable interpretation contrasts well with the ad hominem attacks of those who forget the dictum “the personal is the political” when, for once, it is applicable.

124

piglet 10.03.10 at 12:49 am

Nick 113: “In a word, progressivism. All the joys of paternalism with less than half of the social protection! the US is certainly no libertarian paradise.”

Progressivism isn’t the whole story. US conservatives fully embrace these illiberal restrictions, especially on alcohol and drug use (anti-smoking policies are currently more contentious but that is mostly a function of whether you happen to be a smoker or not). A couple of commenters here have used the strategy of citing a certain policy that is perceived as illiberal and that happens to have been supported by social democrats and conclude from that that social democracy has illiberal tendencies. That is dishonest. Most of the policies in question are not “social democratic” per se, and almost always they have been supported by conservatives. New Labour has been cited. Their authoritarian tendencies, from ASBOs to internment without trial, have been opposed by the left and with few exceptions, supported by the conservatives. US conservatives are mostly responsible for anti-drug and anti-alcohol hysteria. For example, Saint Reagan forced the states to raise the alcohol age to 21. On the whole, European social democracies are famous for their liberalism, compare Netherlands, Sweden. Paternalism is much more evident in the US and its supporters are mnainly on the right. I’m not absolving US progressivism of its very problematic paternalist tendencies but the prohibition was a long time ago.

125

Jim Rose 10.03.10 at 1:23 am

Jack Strocchi,

You do have a point about Hayek’s health. Hayek was unwell from the late 1960s. Any picture of him from after the 1960s shows him to be a skeleton of a once robust man.

Those at a conference on Hayek’s first draft of the fatal conceit in the early 1980s concluded that it was well below publication standard. This was said of one of the most original and sweeping minds of the 20th century. Hayek was extremely unwell from 1985 onwards, at times unable to recognise friends, and many other confusions, and losing touch with reality towards the end.

What of Hayek’s prediction? What did he know and when did he know it?

Dictators had been everywhere in inter-war Europe. Several of the few democracies that had existed were displaced with dictators with little more than a whimper. Admiration for Mussolini was common in the 1930s.

Fascists and communists both advocated central planning. Oswald Mosley, the leader of British fascism, called for a comprehensive “national economic plan” in the 1930s. Nazi Germany had 4 year plans.

Even Keynes wrote an unfortunate preface to the German edition of his General Theory. Keynes once opined that “Mussolini, perhaps, is acquiring wisdom teeth”.

Keynes also admired the young, intellectual, English Communists of the late 1930s because they reminded him of the “typical nonconformist English gentlemen who … made the Reformation, fought the Great Rebellion, won us our civil and religious liberties, and humanized the working classes last century.” Who was the bigger fool?

Hayek had grounds for his pessimism based on what was going on in the world around him. Fortunately, democracy was more resilient than the experience to date in 1944 led him to believe. Great fears for the future was common in those days.

126

Nick 10.03.10 at 1:52 am

228 – I’m happy to agree that paternalistic tendencies within progressivism strongly resemble what you find in conservative ideologies. In many ways they are mutually reinforcing. For example, restrictions on pornography gain intellectual support through various feminist discourses and populist support through conservative moralism.

127

Henri Vieuxtemps 10.03.10 at 11:08 am

Fascists and communists both advocated central planning.

Central planning is something the central governments do, all of them. Central planning is not controversial.

128

Alex 10.03.10 at 11:26 am

And the origins of the problems with the Soviet Union was that it started with an armed coup.

Yes. Yes. I am not aware of any example of a communist state that started with a welfare state and degenerated into tyranny. The tyranny was delivered long before the welfare. Oddly enough, there aren’t that many examples of extreme-right polities that started off as a libertarian paradise/perfectly ordered hierarchy (pick your poison) and degenerated into tyranny either. The thing about tyranny is that it’s an activity, not a state of mind. You get there by usurping legitimate authority, killing off your enemies, demonising anyone who disagrees with you, etc.

That said, can we have less McCarthyism and retroactive ideological policing on this thread? Moderation is called for, I think, both in the sense of “opposite of extremism” and “editing unacceptable material from the comments thread”.

129

bianca steele 10.03.10 at 1:59 pm

Jim Rose:
I wasn’t aware Weathermen and so forth were generally Communist Party members? By the 1980s, among former members of the Movement I came in contact with, it seemed to be generally accepted that nobody was actually a communist anymore, and that many of the eastern bloc countries were not communists anymore anyway. There were very, very few active communists except among people who’d lived in foreign countries with communists participating in the regular political system. It is something like a slur even among the left.

130

Greg Ransom 10.03.10 at 4:54 pm

Samuelson misreported Hayek, smeared him — then lied to him.

Samuelson’s behavior and wilfull misreading of Hayek’s plain words were a disgrace.

There is no evidence that Sameulson looked at Hayek’s book at any time in the last 65 years — and no evidence that Samuelson competently read the book in 1945.

Anyone citing Sameulson on this should be emvarrassed — or knows in the heart what a hack they are.

131

Greg Ransom 10.03.10 at 4:58 pm

Sameulson also massively mireported Hayek’s explanatory strategy and Hayek’s image of scientific explanation — whether out of malevalent intention or patheitc interest it is hard to tell. Most likely a bit of both.

Samuelson in his late years did admit his image of economic science turned out to be a complete failure.

He also — uncharacterisitically — admitted in his late years that Ahyek was right ans his own teacher Schumpeter was wrong about the science of central planning. The key issue of 20th century economics.

132

Greg Ransom 10.03.10 at 4:59 pm

Make that “pathetic ignorance” not “patheitc interest”. Ipad glitch.

133

Greg Ransom 10.03.10 at 5:00 pm

Samuelson in his late years did admit his own image of economic science turned out to be a complete failure.

134

Al 10.03.10 at 5:58 pm

Greg Ransom has to keep repeating his tired old anti-samuelson mantra:

A careful analysis of the Hayek-Samuelson exchange (no threats of legal action despite Ransom all over the web) claiming there were:

http://ideas.repec.org/a/eee/jeborg/v69y2009i1p5-16.html

135

Jim Rose 10.03.10 at 9:38 pm

Greg Ransom ,
In June 2010, Don Boudreaux at Café Hayek looked up what Hayek actually said in response to another debate seeded by Samuelson.

Boudreaux found that Hayek said:

• “The planning against which all our criticism is directed is solely the planning against competition – the planning which is to be substituted for competition.” P. 90
• “Nor is the preservation of competition incompatible with an extensive system of social services.” P.87.

See http://cafehayek.com/2010/06/paul-samuelson-misread-hayek.html

Hayek was talking about options when there is competition and when competition is replaced by planning.

Hayek’s prediction is no more a bizarre and zombie claim than that of unions and others of the Left that workers are at a great disadvantage to employers in the labour market.

Workers are said to be wage slaves and they need extensive legal protections and collective bargaining to even start to rebalance the scales.

Both Hayek and the unions rely on a monopsony argument. Hayek on when the state is the sole employer or where planning made government the de facto sole employer.

Hayek’s argument is better because his hypothesis is where the government is the sole employer backed by the force of law. Central planning would also make the state a de facto monopolist over all sales of goods and services.

Unions argue for monopsony when there are many employers and many more employers than any reasonable stretching of even the word oligopsony could ever encompass.

136

Andy 10.03.10 at 10:01 pm

Hayek on Sweden (and contrary to what Boudreuax would have use believe):

In the preface, Hayek notes that if any reader asked whether he would still “defend all the main conclusions of … [the] book … the answer … is on the whole affirmative” (xxiii). Importantly, Hayek notes that “terminology has changed” between 1944 and 1976, and

for this reason what I say in the book may be misunderstood…. At the time I wrote, socialism meant … nationalization … [and] central economic planning…. [Hence] Sweden … is today very much less socialistically organized than … Britain or Austria, though Sweden is commonly regarded as much more socialistic. This is due to the fact that socialism has come to mean chiefly the extensive redistribution of incomes through taxation and the institutions of the welfare state. In [this] … latter kind of socialism the [totalitarian] effects I discuss in this book [Road to Serfdom] are brought about more slowly, indirectly, and imperfectly … the ultimate outcome tends to be very much the same, although the process by which it is brought about is not quite the same as that described in this book. (Hayek 1976/1994, xxiii–xxiv, emphasis added)

137

John Quiggin 10.03.10 at 10:12 pm

So, Greg Ransom thinks Samuelson was a hack. Same for Stigler and Tullock, who said much the same about TRTS?

138

Greg Ransom 10.03.10 at 10:58 pm

Stigler also misread the book.

I don’t remember Tullock’s comment.

Stigler is famous for his nihilism — and also notorious for doing apologetics for the Knight position against Bohm-Bawerk and the Austrians on capital and production theory in his dissertation written for Knight. Stigler also botched up Hayek’s knowledge coordination economics, by casting the whole thing as a cost issue with “givens” knowable to the economist / model builder.

No, Stigler is not my favorite economist.

Tullock seem unable and unwilling to understand Hayek’s work in trade cycle theory.

Economics is populated by imperfect men with etremely narrow interests and attention spans.

This doesn’t make them evill. It makes them human.

139

Greg Ransom 10.03.10 at 11:03 pm

Jim — I’ve pointed some of these things out myself.

I’ve been circulating Hayek’s statment on social welfare from TRtoS for 15 years — the one that has been making the rounds in recent weeks.

I’m just sick of people “taking on” a cartoon that doesn’t exist — and doing so for political reasons.

It’s a disgrace, and I’m calling people on it.

140

IM 10.03.10 at 11:12 pm

I really don’t think the dictatorships in the thirties in Europe are helpful here. It is true that if you compare a map of Europe in 1930 with 1938 or so, a lot of countries switch from democracy to authoritarian regimes. Mostly around 1933, you can clearly see the effects of the Great Depression here.

But all of these dictatorships were right-wing dictatorships. Most not even fascistic, but conservative or military dictatorships. There was the christian democratic dictatorship in Austria, the conservative dictatorships in Latvia, Estonia and Lithuania, the semi-dictatorship of the military and conservative in Poland, the king-dictatorship in Yugoslavia etc.

Where the great depression moved the politics to the left, in Sweden, Norway, France (the US), even Spain there were no dictatorships.

Of course there were right-wing dominated countries that remained democracy, like Finland or were an turn to the right happened in a entirely democratic fashion, like the UK .

What did not happen in the thirties was a social democratic or democratic socialist party taking power, instituting economic planning and then leading the country into authoritarianism. Not a single example.

So the argument, that if you look at the thirties, Hayeks thesis is somewhat understandable, is wrong.

141

Greg Ransom 10.03.10 at 11:18 pm

The thing that so grates with Samuelson is his dishonesty — his back alley knife in the back dishonesty, served up for political reasons, both as academic/scientific politics and as 1930s left/New Deal vs classic liberal politics.

He lied about Hayek’s account of scientific explanation in economics (or was deeply, irresponsibily, unexcusible ignorant) and he lied about Hayek’s TRtoS and he lied in his promise to Hayek he’d go back and re-read his book and retrack his mischaracterization — but Samuelson admits he purposely misled Hayek, and had no such intention.

Samuelson stuck with his misreading from 40 years before — and never went back to read Hayek’s book to get an honest account based on a charitable read of Hayek’s word and argument.

Samuelson wasn’t interest in getting it right — he was interested in getting it smeared and marginalized.

And I think it’s as plain as day that that was his agenda — from day one of the writing on that topic in his textbook.

142

Jack Strocchi 10.04.10 at 12:05 am

I have always found eastern European socialists much more to my taste than the worthy-but-dull western European types. But thats mainly because of their well-earned sense of gallows humour. You can’t blame the eastern European Hayek for viewing socialist history “through a glass darkly”.

143

IM 10.04.10 at 12:32 am

You can’t blame the eastern European Hayek for viewing socialist history “through a glass darkly”.

Yes, because these austrian social democrats were so frightful.

You know who else disliked austrian social democrats?

144

Jim Rose 10.04.10 at 1:10 am

Greg Ransom,

Tullock’s counter-point is about Sweden being a democracy despite the government accounting for 60%+ of GDP is in a comment of his in the cato journal somewhere.

145

John Quiggin 10.04.10 at 1:53 am

Are you the same Greg Ransom who blogs at the Mises Institute? Given that Institute writers regularly argue that democracy threatens economic freedom e.g.
http://mises.org/daily/1208
I’m surprised that you want to turn the argument around in the way you have.

146

Jim Rose 10.04.10 at 1:56 am

IM ,

thanks for your post. you have a good knowledge of european inter-war history.

My point is that the new concept of democracy looked fragile in the 1930s.

the next challenge for democracy as to central planning.

147

Tim Wilkinson 10.04.10 at 1:58 am

##134, 137:

Thing is, there are quite a few buried caveats in there which can be brandished on demand in this fashion, in true pop-economics style. That’s why somewhere upthread I mentioned a ‘strenuously charitable’ reading. Most readers of course tend not to discard several pages worth of content when they are undermined by a single unobstrusive sentence, and the broad sweep of the thing is very much in a planning – government – fascism – totalitarianism kind of vein, which is how it gets read except when being defended from the back foot.

I’m reminded of Bernard Williams’s review of Anarchy State & Utopia, along lines: ‘there is little comfort here for contemporary friends o business, but that will probably not be noticed’. There is a lot more such comfort in Hayek, though. Stuff against monopoly power, for example, gets minimised by comparison with the power of the Leviathan – because business would have to coordinate (the implication being that it doesn’t. It does, pretty effectively, in a ‘bounded co-operation’ kind of way.)

The stuff about planning is of unclear significance, but basically seems to mean H doesn’t oppose govt economic action when there is no alternative. If the game is faint praise, though, I’d go for Jack Strocchi’s rather entertaining pastiche over this kind of fiddling about.

Re the welfare one-liner: isn’t there also a whole chapter dedicated to establishing that provision of benefits is contrary to the rule of law? I dunno, I’d have to read the wretched thing again, but I really needn’t since a couple of half-sentences do not constitute a case to answer. But come to think of it, there’s comment on one of the other thread that JQ accurately picks up on as more Hayek zombieism, along the lines of the government ‘denying people things’ – taxing them – being oppressive. Hayek takes a similar line on that good ole ‘negative freedom’ idea, i.e. presupposing a certain way of distributing things – property – and then treating departures from that as being encroachments on liberty.

Funny thing is, I think he also has some good stuff on the fact that property rules are quite mutable and that they are part of a design (the good kind of planning) for distributing goods. In fact Hayek is very mixed – IIRC, my impression was that you could probably extract quite a good pamphlet from all the buried caveats, asides and backpedalled concessions in TRTS. But you would definitely have to leave out the stuff about, er, the road to serfdom.

148

Greg Ransom 10.04.10 at 3:31 am

I’m not responsible for the ideas of any writer but myself.

I’ve often attacked the anarchist strain among “Austrians” and defended democracy.

Don’t smear me the way you’ve attempted to smear Hayek.

149

Greg Ransom 10.04.10 at 3:34 am

Serious people should read Hayek’s _Law, Legislation & Liberty_ then his The Constitution of Liberty_

Anyone who thinks they are serious and has read nothing but _The Road to Serfdom_ is pulling everyone’s leg.

150

John Quiggin 10.04.10 at 5:56 am

@Greg I don’t suggest you hold these views, merely that the Mises anti-democrats represent a rejection of Hayek’s arguments from yet another viewpoint. In these circumstances, don’t you think it possible that you (and a few others) are defending TRTS because of a prior commitment to Hayek rather than because it is in fact defensible, while everyone who reads the book without such a prior commitment, and has some connection with factual reality, realises he got this one badly wrong.

As I said in the post, and will repeat, I agree that there is much more to Hayek than TRTS, which is why it’s so silly that this failed piece of prophecy has become his best-known work.

151

Jim Rose 10.04.10 at 7:12 am

John Q,

Would Singapore be an example of central planning leading to a one-party state?

• The state controls and owns firms that comprise at least 60% of the GDP through government entities such as the sovereign wealth fund Temasek;
• The vast majority (more than 80%) of Singaporeans live in public housing;
• Two companies, Singapore Press Holdings Ltd. (SPH) and MediaCorp, own all general circulation newspapers. MediaCorp is wholly owned by the government investment company. SPH is a private holding company with close ties to the Government;
• Government-linked companies and organizations operated all broadcast television channels and almost all radio stations.

The Peoples Action Party (PAP), which has held power continuously and overwhelmingly for more than 4 decades, has used the Government’s extensive powers to place formidable obstacles in the path of political opponents.

although the PAP has consistently rejected the notion of being socialist, some of PAP’s policies do contain aspects of socialism that includes government-owned public housing constituting the majority of real estate and the dominance of government controlled companies in the local economy.

To quote the US state department:

• “The belief that the Government might directly or indirectly harm the employment prospects of opposition supporters inhibited opposition political activity; however, there were no confirmed cases of such retaliation.

• The PAP has an extensive grassroots system and a carefully selected, highly disciplined membership.

• The establishment of government-organized and predominantly publicly funded Community Development Councils (CDCs) has further strengthened the PAP’s position. The Councils promote community development and cohesion and provide welfare and other assistance services.

• The PAP dominates the CDCs even in opposition-held constituencies and has used the threat of withdrawing publicly funded benefits.

• During the last two election campaigns, the Prime Minister and other senior government officials warned voters that precincts that elected opposition candidates would have the lowest priority in government plans to upgrade public housing facilities. This statement heightened concerns among some observers about voters’ genuine freedom to change their government.

• Political parties and organizations were subject to strict financial regulations, including a ban on receiving foreign donations. Government regulations hindered attempts by opposition parties to rent office space in government housing or to establish community foundations. In addition, government influence extended in varying degrees to academic, community service, and other NGOs.

• The threat of civil libel or slander suits, which government leaders have often used against political opponents and critics and consistently won, had a stifling effect on the full expression of political opinion and disadvantaged the political opposition.

• Government entities also used libel or slander suits, and dismissal from positions in government-related entities, to intimidate prominent opposition politicians.”

HT: http://www.state.gov/g/drl/rls/hrrpt/2004/41659.htm

The government of singapore uses monopoly and monopsony powers in the way that Hayek predicted to ensure its re-election and to stifle dissent?

152

John Quiggin 10.04.10 at 7:18 am

Umm, no. According to the Heritage Foundation, Singapore ranks #2 in the world for economic freedom

http://www.heritage.org/index/country/Singapore

#1 is the equally unfree Hong Kong.

153

Jack Strocchi 10.04.10 at 7:24 am

Pr Q said:

Hayek wanted to make the much stronger claim that the attempt to implement Labor’s policies would necessarily lead to a loss of personal and political freedom…Even on this charitable account, a book warning against hypothetical policies that might have been, but weren’t, adopted in the early postwar period, and aren’t advocated by anybody nowadays, would be of fairly marginal historical interest.

To see Hayek’s book as simply a tract for the times or purely directed at Anglo social-democrats is to badly miss the point. Hayek had a number of different socialist targets in his sights around the mid-forties. He famously dedicated the book to “socialists of all parties” .

Obviously Hayek was wrong to tar all social-democrat parties with the dictatorial brush. But in the aftermath of WWI, chaotic social democratic governments did pave the way for totalitarian socialism, in eastern/southern Europe at least.

I have always found eastern and southern European socialists much more to my taste than the worthy-but-dull northern and western European types. But thats mainly because of the “easties” well-earned sense of gallows humour. You can’t blame the eastern European Hayek for viewing socialist history “through a glass darkly”.

Anglo Leftists have a much more Whiggish view of socialist history. Samuelson talks about Anglo and Scandinavian “social democracy” (Roosevelt, Atlee, Palme, Whitlam) as if it is was the sum of all hopes for the democratic Left:

Laboristic Fabian socialists in Britain and Franklin Roosevelt New Deal legislation in America, by innuendo and coherent argument, were believed to be the vulnerable stepping stones toward the serfdom(s) already realized in Lenin-Stalin Russia and Adolph Hitler Nazi Germany.

But thats only half the story, and the cheerier half. Hayek’s theory of social-democracy as the “stepping-stone” to totalitarianism makes more sense in relation to the the less liberal eastern and southern European socialists. In Russia the Menshevik social-democrats who made a mess of the Provisional government, not really making a clear stand against either Reds or White Russians. In Germany the German Social-Democrats never really developed a coherent opposition to either Nazis or Bolsheviks.

Hayek was not saying that all social-democrats are latent totalitarians. The famous chapter in TRTS where Hayek shows how “the worst get to the top” does not point the finger at British social-democrats per se but to totalitarian apparatchiks who exploit the social disorganization caused by social democrats misguided policies and flibbety-gibbet politics.

That socialism can be put info practice only by methods which most socialists disapprove is, of course, a lesson learned by many social reformers in the past. The old socialist parties were inhibited by their democratic ideals; they did not possess the ruthlessness required for the performance of their chosen task. It is characteristic that both in Germany and in Italy the success of fascism was preceded by the refusal of the socialist parties to take over the responsibilities of government.

Granted the relevance of 20th C southern/eastern European social democracy to contemporary American political struggles is limited. But I think that TRTS is a kind of metaphor for the juncture point the US faces, as the US Right finds a European social democratic future not to its taste for a variety of reasons. Once it heads down that road there is no turning back.

154

Jim Rose 10.04.10 at 7:33 am

John Quiggin, thanks for the super-fast reply.

Was any of the information I gave in error? For example:

1. during the last two election campaigns, the Prime Minister and other senior government officials DID NOT warn voters that precincts that elected opposition candidates would have the lowest priority in government plans to upgrade public housing facilities?

2. IT IS MYTH THAT The state controls and owns firms that comprise at least 60% of the GDP through government entities such as the sovereign wealth fund Temasek?

3. The PAP DOES NOT dominates the Community Development Councils (CDCs) that promote community development and cohesion and provide welfare and other assistance services even in opposition-held constituencies and has NOT used the threat of withdrawing publicly funded benefits?

W

155

Jim Rose 10.04.10 at 7:38 am

John, thanks for the fast reply.

Did my information contain errors about, for example:

• The state controls and owns firms that comprise at least 60% of the GDP through government entities such as the sovereign wealth fund Temasek;
• The vast majority (more than 80%) of Singaporeans live in public housing;
• Two companies, Singapore Press Holdings Ltd. (SPH) and MediaCorp, own all general circulation newspapers. MediaCorp is wholly owned by the government investment company. SPH is a private holding company with close ties to the Government;
• Government entities also used libel or slander suits, and dismissal from positions in government-related entities, to intimidate prominent opposition politicians
• During the last two election campaigns, the Prime Minister and other senior government officials warned voters that precincts that elected opposition candidates would have the lowest priority in government plans to upgrade public housing facilities.

What is your explanation for Singapore being labelled a one-party state? The monopoly and monopsony power of government has no major role at all?

156

John Quiggin 10.04.10 at 7:41 am

You need to take this up with the Heritage Institute I think (also Cato, and lots of other libertarians).

157

Jack Strocchi 10.04.10 at 8:39 am

Pr Q said:

Depressingly, most of the rest of the “economic theory Top 20” list, including Wealth of Nations, Free to Choose and the writings of Peter Schiff, suggest that the buyers are the same people buying (if perhaps not reading) Hayek.

There are alot of free-market economists in the Amazon list. One thing that is driving this is that the GFC does look, from a certain angle, as a confirmation of Austrian business cycle theory. Especially the bits about fiat money stimulating housing boom-bust. Hayek’s reputation is obviously going to get a bump on account of this.

Its significant in this context to note that Peter Schiff/a, who Pr Q treats with lofty disdain, was one of the first to predict that the US would suffer a terrible recession on account of its loose monetary policies, morally hazardous banks and politicised lending standards. Schiff’s stocks have certainly jumped since then.

I do feel some sympathy with Pr Q who is an economists economist. But the market for orthodox economic theory seems to be tanking at the moment.

158

Jack Strocchi 10.04.10 at 9:10 am

Jim Rose @ #149 said:

John Q, Would Singapore be an example of central planning leading to a one-party state?…The government of singapore uses monopoly and monopsony powers in the way that Hayek predicted to ensure its re-election and to stifle dissent?

No, Singapore does not fit TRTS model. The NE Asians have copied the fascist economic model, but stripped out the militarism and replaced it with mercantilism. MITI and similar planning agencies have comparable role to the German general-staff, at least in the take-off stages of growth.

The Asian economic powerhouses, from Japan through the Asian Tigers to China, have all combined authoritarian political structures with capitalist economic systems. And they have tied it all together with very traditional cultural values.

Hayek, far from disapproving of this undemocratic set-up, would have been very pleased. In his latter years he came to distrust populist democracy and argued for constitutional curbs on the powers of democratic assemblies, preferably supervised by conservative “elders” (L, L & L Vol 1). I am quite confident that Hayek would have approved of Lee Quan Yu. Hell, I approve of him and I am alot more bolshie than Hayek.

None of this fits the (liberal Blank Slate) standard social science model very well. Consequently the liberal economic model, whether Keynsian, neo-classical or Austrian, simply fails to account for their success. You often get the sense that liberals feel the Asians have somehow “cheated”, when really it all boils down to grey matter, hard work and family values.

I keep waiting for liberal social scientists to even show that they are aware of how irrelevant their doctrines have become given the world-historical significance of NE Asias rise to industrial dominance. But they seem more interested in fighting the ideological battles of yesteryear, of which the TRTS is but one glaring instance.

159

Jim Rose 10.04.10 at 10:23 am

John Quiggin,

Although initially styling itself an anti-Communist and Social Democratic, the People Action Party was expelled from the Socialist International in 1976 because it suppressed dissent and jailed opposition leaders. Hayek would be pleased.

Concerns about the rule of law in Singapore were expressed as far back as the 2000 Index of Economic Freedom in the chapter “In Singapore: Government squanders savings”

The 2010 index of economic says that Singapore is a nominally democratic state that has been ruled by the People’s Action Party (PAP) since it became independent and certain rights, such as freedom of assembly and freedom of speech, remain restricted

The Freedom House 2010 country report notes that Singapore is not an electoral democracy despite elections free of irregularities and mentions that all domestic newspapers, radio stations, and television channels are owned by government-linked companies, which limits free speech.

So when people were putting Singapore forward as an example of successful active industry policy, were you the first to jump up and down every time you hear this saying ‘Not true, not true; Singapore is a close clone of Hong Kong!’ You also better write to Joe Stiglitz who credits the spectacular rise of living standards in Japan, South Korea, Taiwan, Hong Kong, and Singapore, to “the combination of high savings rates, government investment in education, and state-directed industry policy.”

What do we have: an expelled member of the Socialist International using monopoly and monopsony power deriving from wide-spread government ownership of businesses, the media and land to make its very difficult for new parties to compete for power. Hayek’s predictions are rather close to the mark for Singapore.

160

Greg Ransom 10.04.10 at 4:23 pm

John, here’s the problem.

The “prophesy” reading is bunk — Hayek embraces the Welfare State in _TRtoS_ and explicitly says that it will NOT lead to tyranny.

He says this explicitly.

Besides the plain words of the book, there is also the fact of that the British didn’t read the book the way most ideologues (both left and right) read the book in America.

And Hayek explicitly notes this.

Friedman and Stigler mischaracterized the actual content of the book as much as Samuelson and Galbraith (I’m not sure any of them wrote about the book based on anything but distant decades old recollections of the book — recollections shaped more by partisan controversy than anything else.)

So this is in fact false — it didn’t happen in Britain, and as I’ve pointed out to countless people via email lists and blogs and economic conferences, the actual book has countless counter examples to the un-charitable and false reading of the ideologues:

“everyone who reads the book without such a prior commitment .. realises he got this one badly wrong.”

John wrote:

“don’t you think it possible that you (and a few others) are defending TRTS because of a prior commitment to Hayek rather than because it is in fact defensible, while everyone who reads the book without such a prior commitment, and has some connection with factual reality, realises he got this one badly wrong.

As I said in the post, and will repeat, I agree that there is much more to Hayek than TRTS, which is why it’s so silly that this failed piece of prophecy has become his best-known work.”

More later.

161

Greg Ransom 10.04.10 at 4:28 pm

What is silly — and a disgrace — is that leftist gin up a fake “fact” about a non-existent “prophecy” in order to dismiss and marginalize the book — which as you say has all sorts of significant theoretical content within it.

This isn’t an accident.

It isn’t an accident that Ezra Klein did it this weekend, linking your piece above. And it wasn’t an accident when Galbraith and Samuelson and countless other left of center economists did it.

They did it to serve a partisan moral and political and scientific agenda.

It was reprehensible then. And it is reprehensible now.

John wrote,

“I agree that there is much more to Hayek than TRTS, which is why it’s so silly that this failed piece of prophecy has become his best-known work.”

162

Greg Ransom 10.04.10 at 4:29 pm

Note well, the NY Times did it again just this Weekend:

“leftists gin up a fake “fact” about a non-existent “prophecy” in order to dismiss and marginalize the book—which as you say has all sorts of significant theoretical content within it.”

163

Steve LaBonne 10.04.10 at 4:51 pm

I think the extreme boredom inflicted by Greg Ransom’s obsessive and repetitive defenses of Hayek is illegal under the Geneva Conventions.

164

Salient 10.04.10 at 5:36 pm

Might as well remark that right-wing appropriation of Hayek has shown up before.

The road to serfdom is a circle, and serfdom is always just around the corner.

165

Lee A. Arnold 10.04.10 at 5:46 pm

It looks to me like Samuelson didn’t bother understanding Hayek because he lumped him in with the false a priori methodology of Mises and some other Austrians. Since, as I wrote above (# 121), Road to Serfdom is a book of yesteryear and really doesn’t speak to our current problems, Samuelson probably figured that there are other fish to fry. One real problem with the book is that it is a double time-waster, since most of its current readership takes the wrong message from it.

166

Substance McGravitas 10.04.10 at 6:04 pm

the actual book has countless counter examples

Please count them.

167

greg Ransom 10.04.10 at 8:19 pm

McGravitas, do yourself a favor and read the book.

I’m worn out reading it to the little children — I’ve done for too many people too many times already. I’m sick of it.

Go to my “Taking Hayek Seriously” blog and read my Hayek Myths paper for some hints.

168

greg Ransom 10.04.10 at 8:24 pm

The Road to Serfdom is taught to undergraduates at Harvard, the U. of Chicago and other leading universities. You mean those stupid people?

“most of its current readership takes the wrong message from it”

The intellectual pretensions of leftists has become a national joke — are you in on the joke yet?

169

Substance McGravitas 10.04.10 at 8:24 pm

170

Warren G. 10.04.10 at 8:25 pm

Still waiting for a joker to step up and claim that Marx correctly predicted Hayek…

171

Andrew 10.04.10 at 8:30 pm

The paper Greg Ransom references can be found here:

http://www.hayekcenter.org/friedrichhayek/hayekmyth.htm

He writes: “Finally, Hayek repeats that an intelligently worked out program of regulation and welfare would do nothing to endanger the general liberty of the society. That is, implementing reforms of this kind pose no threat to plunging us into a new slavery.”

So does Hayek favor the actually existing welfare state?

172

Andrew 10.04.10 at 9:17 pm

If Hayek is such a big supporter of the welfare state why would he (in the preface to the 76 edition of RTS) write that ” Sweden … is today very much less socialistically organized than … Britain or Austria, though Sweden is commonly regarded as much more socialistic. This is due to the fact that socialism has come to mean chiefly the extensive redistribution of incomes through taxation and the institutions of the welfare state. In [this] … latter kind of socialism the [totalitarian] effects I discuss in this book [Road to Serfdom] are brought about more slowly, indirectly, and imperfectly … the ultimate outcome tends to be very much the same, although the process by which it is brought about is not quite the same as that described in this book. (Hayek 1976/1994, xxiii–xxiv, emphasis added)

173

Greg Ransom 10.04.10 at 10:49 pm

Hayek began as a Fabian socialist (note that his father worked for the government health care system & Hayek’s first job was for the government) and became a bit more “classic liberal”, a bit more “libertarian”, every decade of his life.

My hypothesis is that Mancur Olson’s _The Logic of Collective Action_ proved to be of particular influence on Hayek’s increasing “libertarianism” of the last few decades of his life.

But if you read _Law, Legislation, and Liberty_ or _The Constitution of Liberty_, Hayek’s “libertarianism” is clearly rather limited and measured, allowing for more government and more regulations than most American “libertarians” would ever be comfortable with.

But you can read these books yourself and come to your own conclusions.

Reading is good. Ask your first grade teacher.

174

Greg Ransom 10.04.10 at 10:51 pm

Of course, Sweden for decades has been moving toward the kind of competitive reforms Hayek recommends in _Law, Legislation and Liberty_ hasn’t it?

175

Greg Ransom 10.04.10 at 10:53 pm

“in [this] .. latter kind of socialism the [??????] effects I discuss in this book [Road to Serfdom]”

Hayek discusses all sorts of effects — all sorts of them not at all the same as Stalin’s gulag or Hitler’s night of the long knives.

176

Substance McGravitas 10.04.10 at 11:07 pm

Reading is good. Ask your first grade teacher.

Now there’s something that will make me rush out and buy The Road to Serfdom and the other two books I have to read to make sure I don’t get The Road to Serfdom wrong by reading without seriousness.

177

Lee A. Arnold 10.04.10 at 11:08 pm

Greg Ransom: “The intellectual pretensions of leftists has become a national joke—are you in on the joke yet?”

That makes no sense at all. When you’ve got a bunch of people citing the Road to Serfdom to refute Obamacare because Glen Beck said so, then the statement ““most of its current readership takes the wrong message from it” is accurate. As to a much smaller readership, Harvardites might be able to think their way through it (although sometimes I wonder), but the results are discouraging about Chicago.

178

Andrew 10.05.10 at 1:41 am

“Greg Ransom 10.04.10 at 10:53 pm

“in [this] .. latter kind of socialism the [??????] effects I discuss in this book [Road to Serfdom]”

Hayek discusses all sorts of effects—all sorts of them not at all the same as Stalin’s gulag or Hitler’s night of the long knives.”

For example? In the above quote Hayek is contrasting command planning and the Swedish welfare state. He argues they differ as to policy but lead ultimately to the same totalitarian outcome. See the 1976 preface. The 56 preface is rife with the same sentiments. As are all Hayek’s other post RTS writings (eg – COL, LLL).

Prof. Caldwell – leading Hayek scholar in world – has noted that “at least in 1944 . . . [Hayek] was willing to countenance some level of ‘safety net’ policy. In a
new preface for the book prepared in 1976, however, Hayek wrote
that ‘I had not wholly freed myself from all the current interventionist
superstitions, and in consequence still made various concessions
which I now think unwarranted’” (1997, 1870). As Caldwell explains,
Hayek is alluding to the “comprehensive system of social insurance”
and the guarantee of “a given minimum of sustenance for all” that
he had favored in The Road to Serfdom. This is from Prof Caldwell’s 1997 JEL article on Hayek and Socialism.

I think I’ll take Prof Caldwell’s word over that of a Tea Party hack like Greg Ransom.

179

Andrew 10.05.10 at 1:49 am

The paper Greg Ransom references can be found here:

http://www.hayekcenter.org/friedrichhayek/hayekmyth.htm

He writes: “Finally, Hayek repeats that an intelligently worked out program of regulation and welfare would do nothing to endanger the general liberty of the society. That is, implementing reforms of this kind pose no threat to plunging us into a new slavery.”

So does/would Hayek favor the actually existing welfare state that exists in the UK or USA? Or does such lead us to a new serfdom? I am still waiting for an answer Greg.

As JQ notes above, this may all be the road to deadweight losses but too claim it is a road to the concentration camp is just nutty.

BTW – Hayek (in the 1960 Constitution of Liberty) argues that the British welfare state (assuming the price level doubles and the wicked Labor Party get elected) will end in concentration camps for the old folk. Then there is his nutty 1978 talk in Australia where he rants about the welfare state ending in knouts and machine guns.

Hayek’s 1945 AER is a classic. Aside from that there is no there there when it comes to Hayek. Ideological bunk plain and simple.

180

Greg Ransom 10.05.10 at 1:49 am

Andrew — your remarks are consistent with what I wrote:

“Hayek began as a Fabian socialist (note that his father worked for the government health care system & Hayek’s first job was for the government) and became a bit more “classic liberal”, a bit more “libertarian”, every decade of his life.”

Caldwell, of course, is adding specificity that Hayek didn’t offer. Read Hayek’s _The Constitution of Liberty_ for another endorsement in 1960 of various forms of social insurance, etc.

And not well. These changes in view on Hayek’s part have nothing to do with any “totalitarian prophecy”, as you evidently are suggesting (of is this mere spin that you don’t want to own? If so, say so.)

Andrew wrote:

“Hayek wrote that ‘I had not wholly freed myself from all the current interventionist
superstitions, and in consequence still made various concessions
which I now think unwarranted’” (1997, 1870). As Caldwell explains,
Hayek is alluding to the “comprehensive system of social insurance”
and the guarantee of “a given minimum of sustenance for all” that
he had favored in The Road to Serfdom.”

181

Greg Ransom 10.05.10 at 1:51 am

Wonderful and charming Mr. Andrew. I’m not a participant in the Tea Party movement.

182

Norwegian Guy 10.05.10 at 8:24 pm

Just addressing some points:

1) The British people didn’t listen to this Austrian toff. Instead they went ahead and voted for Labour. They got their “serfdom”, and they like it just fine; Aneurin Bevan has been voted the greatest ever Welshman.

2) The Austrian people hasn’t listened to Hayek either. Post-1945 Austrian politics have been dominated by socialist and christian democrats. I guess the old liberals in the Freedom party were so unsuccessful that by the 90s they had dropped liberalism and turned to something else instead. Don’t know what Hayek had to say about Kreisky & co., but it seams to me that the Austrians rejected Hayek. Austrian economics probably has a greater following in Alabama than in Austria. And, with the exception of a decade in the middle of the 20th century, they have more of a tradition for serfdom there too.

3) Far from instituting serfdom, the Attlee government expanded democracy. The Representation of the People Act 1948 is a prime example. More generally, the point with public ownership and the welfare state is to expand democracy in the economic realm. This is of course the very opposite of serfdom. And the most serf-like institution they’ve got in the UK is the House of Lords, especially the hereditary lords. Who as argued for abolishing, or at least reforming, it? Socialists like Tony Benn of course, not right-wingers like Thatcher & co.

4) That the state wants to reduce smoking and/or drinking isn’t something new. Liquor
prohibition had both been enacted and abolished in many countries before WW2. In Norway, alcohol policy have been steadily liberalised over the past decades, while there have been put in place more restrictions on smoking. This is probably because the number of teetotalists have declined while the number of non-smokers have increased. A fairly straightforward outcome of the democratic process – nothing to do with creeping serfdom.

5) IM in comment 40 nails Hayek pretty well.

6) Fascists rejected class struggle and wanted to attract voters regardless of class. But it is a common misconception that they were competing with the labour parties (social
democrats and communists) over working class support. Fascism was a middle-class movement, in the European sense of the word middle class, not the one that is common in the US. The German petite bourgeoisie supported the Nazis, while the working class supported antifascists like the Social Democrats or the Communists. And as the Nazi share of the votes increased, it was the conservative and liberal parties that lost, while the left-wing parties (and the Catholics) held their support pretty well.

7) As for the rise of fascism, and interwar European political history more generally, I can not recommend this book to highly:

Gregory M. Luebbert (1991): Liberalism, Fascism, or Social Democracy: Social Classes and the Political Origins of Regimes in Interwar Europe

“This work provides a sweeping historical analysis of the political development of Western Europe in the late 19th and early 20th century. The author argues that the evolution of most European nations into liberal democracies, social democracies or fascist regimes was attributable to a discrete set of social and class alliances within individual nations. In Britain, France and Switzerland, countries with a unified middle class, liberal forces established political hegemony before World War I. By co-opting considerable sections of the working class with reforms that weakened union movements, liberals essentially excluded the fragmented working class from the political process, remaining in power throughout the inter-war period. In countries with a strong, cohesive working class and a fractured middle class, Luebbert points out, a liberal solution was impossible. In Norway, Sweden, Denmark and Czechoslovakia, political coalitions of social democrats and “family peasantry” emerged as a result of World War I, resulting in social democracies. In Spain, Italy and Germany, on the other hand, the urban middle class united with a peasantry hostile to socialism to facilitate the rise of fascism.”

http://books.google.com/books?id=d9o7iP_yBR8C&lpg=PA235&ots=oZ6wVQBP3e&dq

8) Lots and lots of people, including economists, predicted a great financial crisis. It was basically only the neoliberals that thought it would not happen. There is no need for this Schiff guy when Steve Keen is around:

http://rwer.wordpress.com/2010/05/13/keen-roubini-and-baker-win-revere-award-for-economics-2/

That silly right-wingers have risen to the top of the English-language list, while in Germany Karl Marx rose to the top of the bestseller lists, must account for something. After all, one of the central points of Marx was that economic crises are an integral part of capitalism.

183

Hidari 10.06.10 at 7:31 am

‘ Hayek (in the 1960 Constitution of Liberty) argues that the British welfare state (assuming the price level doubles and the wicked Labor Party get elected) will end in concentration camps for the old folk. Then there is his nutty 1978 talk in Australia where he rants about the welfare state ending in knouts and machine guns.’

Hayek is not only wrong about what happens in democracies under democratic socialist party he is also wrong about how socialist/communist govt.s get into power. I amen’t aware of the relevant sociological data, but it seems to me obvious that most ‘radical’ left wing parties get into power after a civil war or some other equivalent social disaster. Think about it. Lenin came to power when the Russian Empire entered the 1st world war, and did extremely badly in it, provoking a huge ‘internal’ social cataclysm. Mao came to power after a civil war, and after Chinese society had been torn up by the Japanese invasion. Stalin’s ‘expansion’ into Eastern Europe was only possible because of the social cataclysm of WW2. The Vietnamese only came to power (again) after a gigantic, decades long ‘civil war’ (kept going by the Americans of course): similarly the Khmer Rouge could only have come to power after the American de facto invasion (and again a more or less civil war situation).

Communist parties generally speaking do not come to power via the democratic process and when they do they normally keep to democratic norms (cf the situation in South America, and other examples, cf Nepal). If these parties ever look like becoming ‘too radical’ they are quickly overthrown by the Americans (Allende, obviously, and in our time, Honduras, Haiti).

It’s fascist parties that sometimes come to power via the ‘democratic process’ or some variation of it, and there is no mystery why: in capitalist countries the ‘ruling class’ or whatever you want to call them, invariably lean Right, and if it ever looks like some major disruption is coming (that might lead to the growth in power of socialist/communist parties) they will choose fascism over socialism, every time.

It’s not just that Hayek’s ‘slow descent into barbarism’ rarely happens. AFAIK it has never happened.

184

Greg Ransom 10.06.10 at 4:32 pm

Hidari, you lie like a rug.

Part for the course for deranged Hayek haters.

185

Greg Ransom 10.06.10 at 4:38 pm

Note well — much of the intellectual vanguard of the British left _liked_ what they saw in Stalin’s Russia. And the intellectual vanguard included the chairman of the British Labour party at the time of _The Road to Serfdom_.

The Labour party rejected this direction. But this isn’t because of the ideas and ambitions of the intellectual vanguard. It was despite them.

Ideas mattered — the vanguard was defeated. But it took counter-arguments to raise the stop sign, and turn them back.

186

Hidari 10.06.10 at 6:03 pm

‘Hidari, you lie like a rug.

Part for the course for deranged Hayek haters.’

Apart from the fact that I’m not lying and I’m not a Hayek hater, I completely agree with this.

187

Andrew 10.06.10 at 7:44 pm

Greg writes: “The Labour party rejected this direction. But this isn’t because of the ideas and ambitions of the intellectual vanguard”

Had they rejected this supposed direction prior to 1944 or is it because of Hayek?

I thought the Labour leadership had pretty much rejected Laski’s ideas long before 44 .

188

Andrew 10.06.10 at 10:34 pm

Also when Greg says “Labour Party” does he mean the Labour Party, the PLP? Both? Or?

189

piglet 10.06.10 at 10:50 pm

It’s fascist parties that sometimes come to power via the ‘democratic process’ or some variation of it, and there is no mystery why: in capitalist countries the ‘ruling class’ or whatever you want to call them, invariably lean Right, and if it ever looks like some major disruption is coming (that might lead to the growth in power of socialist/communist parties) they will choose fascism over socialism, every time.

That is so true.

190

michael e sullivan 10.07.10 at 7:49 pm

“And this is why the whole criticism seems awfully bitter and just plain odd. Would some right-winger hold up the Communist Manifesto and gnash his teeth about how awfully misguided and erroneous the book is? Were someone to do such a ridiculous thing, should we not laugh at him?”

We might not laugh if the Communist Manifesto were sitting at #1 on the Economic Theory charts based on the strong recommendations of a bunch of left-wing pundits.

191

Nate 10.08.10 at 1:25 pm

“Obama is propelling the US along the Road to Serfdom by making medical care marginally more affordable.”

To bad this argument doesn’t hold true outside of academia. Reform has already added cost over and above what insurance inflation would have been. Almost every working actuary has warned of significant additional cost because of ObamaCare. It is almost impossible to purchase a child only individual policy becuase the cost of such a plan exceeds what the carrier can charge.

” the kind of disconnection from reality going on on the political right. “
“shared by everyone in mainstream economics “

That’s the great thing about being an acedemic economist, you can ignore the reality around you and make such claims based on theory or the study some propogandist organization paid you for. The fact actual real living individuals and businesses are already paying more you can still claim healthcare is marginally more affordable.

“Medicare (hospital insurance). In 1965, as Congress considered legislation to establish a national Medicare program, the House Ways and Means Committee estimated that the hospital insurance portion of the program, Part A, would cost about $9 billion annually by 1990.v Actual Part A spending in 1990 was $67 billion. The actuary who provided the original cost estimates acknowledged in 1994 that, even after conservatively discounting for the unexpectedly high inflation rates of the early ‘70s and other factors, “the actual [Part A] experience was 165% higher than the estimate.”

Medicare (entire program). In 1967, the House Ways and Means Committee predicted that the new Medicare program, launched the previous year, would cost about $12 billion in 1990. Actual Medicare spending in 1990 was $110 billion—off by nearly a factor of 10.”

Good thing we listened to the economist in the mid to late 60’s, they have such a great track record on these things.

Care to link to any accurate medicare projections from the ecomonist you want us to beleive now?

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