This classic by one of the 20th century's leading economic thinkers has established itself beside the works of Orwell and others as a timeless meditation on the relationship between human freedom and government authority. Hayek argues that empowering government with increasing economic control... read more
Having lived and traveled in the German-speaking countries before, during and after World War I, the economist Friedrich Hayek saw collectivism and central planning contribute to war and undermine democracy. Living in England and traveling in America in the 1930s, he hears the same ideas being... read more (warning: may contain spoilers)
Having lived and traveled in the German-speaking countries before, during and after World War I, the economist Friedrich Hayek saw collectivism and central planning contribute to war and undermine democracy. Living in England and traveling in America in the 1930s, he hears the same ideas being expressed that attended Germany's descent into despotism. Fearful that the political and intellectual climate of his adopted home is becoming similar to that of his native Central Europe of 25 years earlier, he writes this book as a warning "to the socialists of all parties" and argues the following three things. 1) The value that the West puts on independent thought and initiative, individual conviction and integrity, respect and tolerance for others, consideration for the weak, and distrust of power are all made possible by the traditions of free market capitalism and individual liberty. 2) Collectivism and central planning are not only inefficient but necessarily lead to an ends-justify-the-means mentality that runs counter to those humanistic values. 3) Once collectivist central planning takes hold of a society, government will not long “remain in the hands of benevolent despots when it would be so much more easy for any group of ruffians to keep itself indefinitely in power.” This, Hayek is aware, contradicts Alexis de Tocqueville, who thought that “servitude of the regular, quiet and gentle kind … might be combined more easily than is commonly believed with some of the outward forms of freedom and that it might even establish itself under the wing of the sovereignty of the people,” perhaps maintaining a benevolent despotism for a very long time. Hayek warns that this might not be the case and that, eventually if not sooner, central planning will coarsen us by putting collective goals above individual goals to the extent that society will be persuaded of the need to suppress the individual by any means necessary including brutality.
“Nothing is more fatal than the present fashion among intellectual leaders of extolling security at the expense of freedom.”
“It is now often said that democracy will not tolerate 'capitalism'. If 'capitalism' means here a competitive system based on free disposal of property, it is far more important to realize that only within this system is democracy possible. When it becomes dominated by a collectivist creed, democracy will inevitably destroy itself.”
We are ready to accept almost any explanation of the present crisis of our civilization except one: that the present state of the world may be the result of genuine error on our own part and that the pursuit of some of our most cherished ideals has apparently produced results utterly different from those which we expected.Highlighted by 299 Kindle customers
“Democracy extends the sphere of individual freedom,” he said in 1848; “socialism restricts it. Democracy attaches all possible value to each man; socialism makes each man a mere agent, a mere number. Democracy and socialism have nothing in common but one word: equality. But notice the difference: while democracy seeks equality in liberty, socialism seeks equality in restraint and servitude.”3Highlighted by 292 Kindle customers
In this sense socialism means the abolition of private enterprise, of private ownership of the means of production, and the creation of a system of “planned economy” in which the entrepreneur working for profit is replaced by a central planning body.Highlighted by 291 Kindle customers
Although we had been warned by some of the greatest political thinkers of the nineteenth century, by Tocqueville and Lord Acton, that socialism means slavery, we have steadily moved in the direction of socialism.Highlighted by 291 Kindle customers
The question is whether for this purpose it is better that the holder of coercive power should confine himself in general to creating conditions under which the knowledge and initiative of individuals are given the best scope so that they can plan most successfully; or whether a rational utilization of our resources requires central direction and organization of all our activities according to some consciously constructed “blueprint.”Highlighted by 234 Kindle customers
Few are ready to recognize that the rise of fascism and naziism was not a reaction against the socialist trends of the preceding period but a necessary outcome of those tendencies.Highlighted by 232 Kindle customers
planning and competition can be combined only by planning for competition but not by planning against competition.Highlighted by 224 Kindle customers
To prohibit the use of certain poisonous substances or to require special precautions in their use, to limit working hours or to require certain sanitary arrangements, is fully compatible with the preservation of competition. The only question here is whether in the particular instance the advantages gained are greater than the social costs which they impose. Nor is the preservation of competition incompatible with an extensive system of social services—so long as the organization of these services is not designed in such a way as to make competition ineffective over wide fields.Highlighted by 175 Kindle customers
Individualism has a bad name today, and the term has come to be connected with egotism and selfishness.7 But the individualism of which we speak in contrast to socialism and all other forms of collectivism has no necessary connection with these.Highlighted by 160 Kindle customers
It seems almost as if we did not want to understand the development which has produced totalitarianism because such an understanding might destroy some of the dearest illusions to which we are determined to cling.Highlighted by 157 Kindle customers
Chapter 1, The Abandoned Road
Chapter 2, The Great Utopia
Chapter 3, Individualism and Collectivism
Chapter 4, The 'Inevitability' of Planning
Chapter 5, Planning and Democracy
Chapter 6, Planning and the Rule of Law
Chapter 7, Economic Control and Totalitarianism
Chapter 8, Who, Whom?
Chapter 9, Security and Freedom
Chapter 10, Why the Worst Get on Top
Chapter 11, The End of Truth
Chapter 12, The Socialist Roots of Nazism
Chapter 13, The Totalitarians in our Midst
Chapter 14, Material, Conditions and Ideal Ends
Chapter 15, The Prospects of International Order
Chapter 16, Conclusion
Page vii "merts" should be "merits"
Page 29 "German" should be "Germany"
Page 41 "...it is must be possible..." should be "it must be possbile..."
Page 50 "tumbled" should be "stumbled"
Page 55 "units" should be "unites"
Pages 100 and 102 "freedon" should be "freedom"
Page 150 "woman" should probably be "women"
194 "to ward" should be "to-ward" (hyphenated at line break)
198 "The problem of monopoly would not be difficult as it is..." should probably be "...as difficult as..."
204 "connceted" should be "connected"
208 "the economic system has to adopt itself to continuous changes..." should be "...has to adapt itself..."
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