ircart/uncat/serf.txt

The Road to Serfdom
with The Intellectuals and Socialism
The Road to Serfdom
with The Intellectuals and Socialism
FRIEDRICH A. HAYEK
t h e c o n d e n s e d v e r s i o n o f t h e roa d t o s e r f d o m
by f . a . h ay e k a s i t a p p e a r e d i n t h e a p r i l 1 9 4 5
e d i t i o n o f r e a d e r’ s d i g e st
The Institute of Economic Affairs
5
This combined edition fi rst published in Great Britain in 2005 by
The Institute of Economic Affairs
2 Lord North Street
Westminster
London SW1P 3LB
in association with Profi le Books Ltd
This condensed version of The Road to Serfdom was fi rst published in Great Britain in 1999
in the ‘Rediscovered Riches’ series by The Institute of Economic Affairs, and reissued as
Occasional Paper 122 in 2001
This condensed version of The Road to Serfdom © Reader’s Digest,
reproduced by kind permission
The Road to Serfdom is published in all territories outside the USA by Routledge.
This version is published by kind permission.
‘The Intellectuals and Socialism’ previously published in Great Britain in 1998 in the
‘Rediscovered Riches’ series by the Institute of Economic Affairs
‘The Intellectuals and Socialism’ © The University of Chicago Law Review 1949.
Reproduced by kind permission.
All other material copyright © The Institute of Economic Affairs 2005
Every effort has been made to contact the copyright holders associated with this edition.
The IEA will be pleased to include any corrections in future printings.
The mission of the Institute of Economic Affairs is to improve public understanding of
the fundamental institutions of a free society, with particular reference to the role of
markets in solving economic and social problems.
The moral right of the authors has been asserted.
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ISBN 0 255 36576 4
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The authors 7
Foreword by Walter E. Williams 10
THE ROAD TO SERFDOM
Foreword by Edwin J. Feulner Jr 19
Introduction: Hayek, Fisher and The Road to Serfdom
by John Blundell 22
Preface to the Reader’s Digest condensed version of
The Road to Serfdom 34
Summary 35
The Road to Serfdom (condensed version) 39
Planning and power 40
Background to danger 42
The liberal way of planning 45
The great utopia 47
Why the worst get on top 51
Planning vs. the Rule of Law 57
Is planning ‘inevitable’? 59
Can planning free us from care? 61
Two kinds of security 66
Toward a better world 70
CONTENTS
7
The Road to Serfdom in cartoons 71
THE INTELLECTUALS AND SOCIALISM
Foreword by Edwin J. Feulner Jr 93
Introduction: Hayek and the second-hand dealers in ideas
by John Blundell 96
The Intellectuals and Socialism 105
About the IEA 130
Friedrich A. Hayek
Friedrich A. Hayek (1899–1992) was born in Vienna and obtained
two doctorates from the University of Vienna, in law and political
economy. He worked under Ludwig von Mises at the Austrian
Institute for Business Cycle Research, and from 1929 to 1931 was
a lecturer in economics at the University of Vienna. His fi rst
book, Monetary Theory and the Trade Cycle, was published in 1929.
In 1931 Hayek was made Tooke Professor of Economic Science
and Statistics at the London School of Economics, and in 1950
he was appointed Professor of Social and Moral Sciences at the
University of Chicago. In 1962 he was appointed Professor of
Political Economy at the University of Freiburg, where he became
Professor Emeritus in 1967. Hayek was elected a Fellow of the
British Academy in 1944, and in 1947 he organised the conference
in Switzerland which resulted in the creation of the Mont Pèlerin
Society. He was awarded the Nobel Prize in Economics in 1974 and
was created a Companion of Honour in 1984. In 1991 George Bush
awarded Hayek the Presidential Medal of Freedom. His books
include The Pure Theory of Capital, 1941, The Road to Serfdom, 1944,
The Counter-Revolution of Science, 1952, The Constitution of Liberty,
1960, Law, Legislation and Liberty, 1973–9, and The Fatal Conceit,
1988.
THE AUTHORS
t h e roa d to serfdom with t h e i n t e l l e c ua l s a n d s o c i a l i s m
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t h e authors
John Blundell
John Blundell is Director General of the Institute of Economic
Affairs. He was previously President of the Institute for Humane
Studies at George Mason University and the Atlas Economic
Research Foundation, founded by the late Sir Antony Fisher to
establish ‘sister’ organisations to the IEA. He serves on the boards
of both organisations and is a former Vice President of the Mont
Pèlerin Society.
Edwin J. Feulner Jr
Edwin J. Feulner Jr has served as President of the Heritage Foundation
since 1977. He is a past President of the Mont Pèlerin Society.
He previously served in high-level positions in both the legislative
and executive branches of the United States federal government.
He received his Ph.D. from the University of Edinburgh and was
awarded the Presidential Citizen’s Medal by Ronald Reagan in
1989 for ‘being a leader of the conservative movement by building
an organisation dedicated to ideas and their consequences . . . ’
Walter E. Williams
Walter Williams is John M. Olin Distinguished Professor of
Economics at George Mason University, Fairfax, Virginia. In
addition, he serves as an Adjunct Professor of Economics at Grove
City College in Grove City, Pennsylvania. He has also served on
the faculties of Los Angeles City College, California State University
Los Angeles, and Temple University in Philadelphia. He is the
author of over eighty publications that have appeared in scholarly
journals such as Economic Inquiry, American Economic Review,
Georgia Law Review, Journal of Labor Economics and Social Science
Quarterly, as well as popular publications such as Newsweek, The
Freeman, National Review, Reader’s Digest, Cato Journal and Policy
Review. Dr Williams serves on the boards of directors of Citizens
for a Sound Economy, the Reason Foundation and the Hoover
Institution, and on the advisory boards of the IEA, the Landmark
Legal Foundation, the Alexis de Tocqueville Institute, the Cato
Institute and others. He has frequently given expert testimony
before Congressional committees on public policy issues ranging
from labour policy to taxation and spending. He is a member of
the Mont Pèlerin Society and the American Economic Association.
10
foreword
11
order later expressed in the writings of British philosophers such
as John Stuart Mill and David Hume.
What happened in Germany? Hayek explains, ‘The supreme
tragedy is still not seen that in Germany it was largely people of
good will who, by their socialist policies, prepared the way for
forces which stand for everything they detest’. Hayek’s explanation
for the rise of Nazism was not understood and appreciated
in 1944, and it is still not fully understood and appreciated today.
Collectivism, whether it is in Germany, the former Soviet Union,
Britain or the USA, makes personal liberty its victim.
How do we combat collectivism? Hayek provides some
answers in The Intellectuals and Socialism. In a word or two, those
who support the liberal social order must attack the intellectual
foundations of collectivism. Hayek urges that an understanding
of just what it is that leads many intellectuals toward socialism
is vital. It is neither, according to Hayek, selfi sh interests nor evil
intentions that motivate intellectuals towards socialism. On the
contrary, they are motivated by ‘mostly honest convictions and
good intentions’. Hayek adds that it is necessary to recognise
that ‘the typical intellectual is today more likely to be a socialist
the more he is guided by good will and intelligence’. Joseph A.
Schumpeter differed, seeing Hayek’s assessment as ‘politeness to
a fault’.2
Hayek argues that the roots of collectivism have nowhere originated
among working-class people. Its roots lie among intellectuals
– the people Hayek refers to as ‘second-hand dealers in ideas’
– who had to work long and hard to get working-class people to
2 J. Schumpeter, review of The Road to Serfdom, Journal of Political Economy, June
1946: 269–270.
FOREWORD
Friedrich A. Hayek was one of the twentieth century’s greatest
philosophers. While he is best known for his work in economics,
he also made signifi cant contributions in political philosophy and
law. The publication for which Professor Hayek is most widely
known is The Road to Serfdom, written during World War II, the
condensed Reader’s Digest version of which is presented here along
with what might be seen as his follow-up, The Intellectuals and
Socialism, fi rst published by the University of Chicago Law Review
in 1949.
A focal point of The Road to Serfdom was to offer an explanation
for the rise of Nazism, to correct the popular and erroneous
view that it was caused by a character defect of the German people.
Hayek differs, saying that the horrors of Nazism would have been
inconceivable among the German people a mere fi fteen years
before Adolf Hitler’s rise to power. Indeed, ‘throughout most
of its history [Germany was] one of the most tolerant European
countries for Jews’.1 Other evidence against the character defect
argument is that the writings of some German philosophers, such
as Johann Wolfgang von Goethe, Wilhelm von Humboldt and
Friedrich Schiller, served as inspiration for ideas about the liberal
1 Thomas Sowell, The Economics and Politics of Race, William Morrow & Company,
New York, 1983, p. 86.
t h e roa d to serfdom with t h e i n t e l l e c ua l s a n d s o c i a l i s m
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foreword
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radio stations, on satellite and over the internet, reaching tens of
millions of people worldwide each week. Much to socialist dismay,
the most popular and successful talk radio shows are those hosted
by conservative/free market hosts. Then there are the bloggers
– the electronic equivalent of conservative/free market journalists
– who are constantly at the ready to challenge and reveal news
stories.
While there have been monumental changes in the ideas
marketplace, the last bastion of solidly entrenched socialism lies
on college and university campuses around the world. Hayek
argues that ‘It is perhaps the most characteristic feature of the
intellectual that he judges new ideas not by their specifi c merits
but by the readiness with which they fi t into his general conceptions,
into the picture of the world which he regards as modern or
advanced’.
Professor Thomas Sowell puts the argument in another way
that encompasses Hayek’s.3 Sowell says that there are essentially
two visions of how the world operates – the constrained vision
and the unconstrained. The constrained vision sees mankind with
its moral limitations, acquisitiveness and ego as inherent and
immutable. Under this vision, the fundamental challenge that
confronts mankind is to organise a system consisting of social
mores, customs and laws that make the best of the human condition
rather than waste resources trying to change human nature.
It is this constrained vision of mankind that underlies the thinking
and writings of Adam Smith, Edmund Burke and Alexander
Hamilton, among others.
3 Thomas Sowell, A Confl ict of Visions: Ideological Origins of Political Struggles, William
Morrow & Company, New York, 1987.
accept the vision they put forward. The intellectuals or secondhand
dealers in ideas to whom he refers are journalists, teachers,
ministers, radio commentators, cartoonists and artists, who
Hayek says ‘are masters of the technique of conveying ideas but
are usually amateurs so far as the substance of what they convey
is concerned’.
In 1949, when Hayek wrote The Intellectuals and Socialism,
the second-hand dealers in collectivist ideas were a dominant
force. He appeared to be pessimistic about the future of liberty
because those who were on the conservative/free market side of
the political spectrum were weak, isolated and had little voice. In
1947, Hayek, along with several other distinguished free market
scholars, addressed some of the isolation by founding the Mont
Pèlerin Society. The purpose of the Society was to hold meetings
and present papers and exchange ideas among like-minded
scholars with the hope of strengthening the principles of a free
society. The Mont Pèlerin Society now has over 500 members
worldwide, and can boast that eight of its members have won
Nobel Prizes in economics.
Since Hayek wrote The Intellectuals and Socialism there has
been nothing less than monumental change in the marketplace
of ideas. In 1949, there was only one free market organisation
– The Foundation for Economic Education, founded by Leonard
Read. Today there are over 350 free market organisations in 50
countries, including former communist countries. The major
media no longer has the monopoly on news and the dissemination
of ideas that it once had. Network television faces competition
from satellite and cable television. Talk radio has exploded.
The Rush Limbaugh Show, on which I have served as occasional
substitute host for over thirteen years, is carried on 625 different
t h e roa d to serfdom with t h e i n t e l l e c ua l s a n d s o c i a l i s m
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foreword
15
the case, strongly defend polar opposite policies? I believe part of
the answer is that they make different initial premises of how the
world works. If one’s initial premise is that an employer needs so
many workers to perform a particular job, then enacting a higher
minimum wage means that all the workers will keep their jobs.
The only difference is that they will receive higher wages and the
employer will make less profi t. Thus, enacting a higher minimum
wage clearly benefi ts low-skilled workers. By contrast, if one’s
initial premise is that there are alternative means to produce a
product, and employers will seek the least-cost method of doing
so, then raising the minimum wage will cause employers to seek
substitutes such as automation or relocation overseas, thereby
reducing the amount of workers they hire. With the latter vision,
one can have the interests of low-skilled workers at heart and
oppose an increase in the minimum wage, because it reduces
opportunities for low-skilled workers. If Hayek is correct in his
assessment of socialists, it would appear that it is a simple task to
empirically show that there are alternative methods of production
and that employers are not insensitive to increases in the cost of
workers.
The second part of the strategy is to make better, unassailable
arguments for personal liberty. Any part of the socialist agenda
can be shown as immoral under the assumption that people own
themselves. The idea of self ownership makes certain forms of
behaviour unambiguously immoral. Murder, rape and theft are
immoral simply because they violate a person’s property rights to
himself. Government programmes such as subsidies to farmers,
bailouts for businesses, and welfare or medical care for the
indigent are also immoral for the same reason. Government has
no resources of its very own. The only way government can give
By contrast, the unconstrained vision sees mankind as capable
of perfection and capable of putting the interests of others fi rst.
Sowell says that no other eighteenth-century writer’s vision stands
in starker contrast to that of Adam Smith than William Godwin’s
in Enquiry Concerning Political Justice. Godwin viewed intention to
benefi t others as the essence of virtue that leads to human happiness.
Benefi ts to others that arise unintentionally are virtually
worthless. Sowell says, ‘Unlike Smith, who regarded human selfishness
as a given, Godwin regarded it as being promoted by the
very system of rewards used to cope with it’.4
In the last paragraph of The Intellectuals and Socialism, Hayek
says, ‘Unless we [true liberals] can make the philosophic foundation
of a free society once more a living intellectual issue, . . . . the
prospects of freedom are indeed dark’. If Hayek is correct that
neither selfi sh interests nor evil intentions motivate intellectuals
towards socialism, there are indeed grounds for optimism. Education
offers hope. We can educate them, or at least make others
immune, to the errors of their thinking.
I think the strategy has at least two principal components.
First, there is not a lot to be gained by challenging the internal logic
of many socialist arguments. Instead, it is the initial premises that
underlie their arguments that must be challenged. Take one small
example. One group of people articulates a concern for the lowskilled
worker and argues for an increase in the minimum wage
as a means to help them. Another group of people articulating the
identical concern might just as strongly oppose an increase in the
minimum wage, arguing that it will hurt low-skilled workers.
How can people who articulate identical ends, as is so often
4 Ibid., p. 24.
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16
one person money is to fi rst take it from another person. Doing
so represents the forcible using of one person, through the tax
code, to serve the purposes of another. That is a form of immorality
akin to slavery. After all, a working defi nition of slavery is
precisely that: the forcible use of one person to serve the purposes
of another.
Well-intentioned socialists, if they are honest people as Hayek
contends, should be able to appreciate that reaching into one’s
own pockets to assist one’s fellow man is laudable and praiseworthy.
Reaching into another’s pocket to do so is theft and by
any standard of morality should be condemned.
Collectivists can neither ignore nor dismiss irrefutable
evidence that free markets produce unprecedented wealth.
Instead, they indict the free market system on moral grounds,
charging that it is a system that rewards greed and selfi shness and
creates an unequal distribution of income. Free markets must be
defended on moral grounds. We must convince our fellow man
there cannot be personal liberty in the absence of free markets,
respect for private property rights and rule of law. Even if free
markets were not superior wealth producers, the morality of the
market would make them the superior alternative.
wa lt e r e . w i l l i a m s
John M. Olin Distinguished Professor of Economics
George Mason University, Fairfax, Virginia
May 2005
The views expressed in Occasional Paper 136 are, as in all IEA
publications, those of the author and not those of the Institute
(which has no corporate view), its managing trustees, Academic
Advisory Council members or senior staff.
The Road to Serfdom
John Chamberlain characterised the period immediately
following World War II in his foreword to the fi rst edition of The
Road to Serfdom as ‘a time of hesitation’. Britain and the European
continent were faced with the daunting task of reconstruction
and reconstitution. The United States, spared from the physical
destruction that marked Western Europe, was nevertheless recovering
from the economic whiplash of a war-driven economic
recovery from the Great Depression. Everywhere there was a
desire for security and a return to stability.
The intellectual environment was no more steady. The rise
and subsequent defeat of fascism had provided an extremely wide
fl ank for intellectuals who were free to battle for any idea short
of ethnic cleansing and dictatorial political control. At the same
time, the mistaken but widely accepted notion that the unpredictability
of the free market had caused the depression, coupled
with four years of war-driven, centrally directed production, and
the fact that Russia had been a wartime ally of the United States
and England, increased the mainstream acceptance of peace-time
government planning of the economy.
At this hesitating, unstable moment appeared the slim volume
of which you now hold the condensed version in your hands,
F. A. Hayek’s The Road to Serfdom. Occupying his spare time
between September 1940 and March 1944, the writing of The Road
19
FOREWORD
t h e roa d to serfdom
with t h e i n t e l l e c ua l s a n d s o c i a l i s m
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foreword
21
destinely behind the emerging iron curtain. It is no exaggeration
to say that The Road to Serfdom simultaneously prevented the
emergence of full-blown socialism in Western Europe and the
United States and planted seeds of freedom in the Soviet Union
that would fi nally bear fruit nearly 45 years later. Socialist catchphrases
such as ‘collectivism’ were stricken from the mainstream
political debate and even academic socialists were forced to retreat
from their defence of overt social planning.
But the true value of The Road to Serfdom is to be found not in
the immediate blow it dealt to socialist activists and thinkers – as
important as that was – but in the lasting impression it has made
on political and economic thinkers of the past 55 years. By Hayek’s
own admission, ‘this book . . . has unexpectedly become for me
the starting point of more than 30 years’ work in a new fi eld’.3
e d w i n j . f e u l n e r j r
November 1999
3 Although these words were written in 1976 it is safe to say that the infl uence of
The Road to Serfdom guided Hayek’s work until his death in 1992.
to Serfdom was in his own words more ‘a duty which I must not
evade’1 than any calculated contribution to his curriculum vitae.
As Hayek saw it, he was merely pointing out ‘apprehensions which
current tendencies [in economic and political thought] must create
in the minds of many who cannot publicly express them . . . ’2 But
as is often the case, this duty-inspired task had tremendous consequences
unintended by the author.
Hayek employed economics to investigate the mind of man,
using the knowledge he had gained to unveil the totalitarian
nature of socialism and to explain how it inevitably leads to
‘serfdom’. His greatest contribution lay in the discovery of a
simple yet profound truth: man does not and cannot know everything,
and when he acts as if he does, disaster follows. He recognised
that socialism, the collectivist state, and planned economies
represent the ultimate form of hubris, for those who plan them
attempt – with insuffi cient knowledge – to redesign the nature of
man. In so doing, would-be planners arrogantly ignore traditions
that embody the wisdom of generations; impetuously disregard
customs whose purpose they do not understand; and blithely
confuse the law written on the hearts of men – which they cannot
change – with administrative rules that they can alter at whim.
For Hayek, such presumption was not only a ‘fatal conceit’, but
also ‘the road to serfdom’.
The impact of the simple ideas encapsulated in The Road to
Serfdom was immediate. The book went through six impressions
in the fi rst 16 months, was translated into numerous foreign
languages, and circulated both openly in the free world and clant
1 F. A. Hayek, The Road to Serfdom, Routledge, London, 1944, p. v.
2 Ibid., p. vii.
22
Treatise on Money)3 had been ripped apart by Hayek in a two-part
journal review. Keynes had shrugged off the attack with a smile,
saying as they passed one day in Clare Market: ‘Oh, never mind;
I no longer believe all that.’ Hayek was not about to repeat the
demolition job on The General Theory in case Keynes decided, at
some future point, that he no longer believed in ‘all that’ either – a
decision I heard Hayek regret often in the 1970s.
War came and the LSE was evacuated from central London
to Peterhouse College, Cambridge. Typically, Keynes arranged
rooms for his intellectual arch-rival Hayek at King’s College where
Keynes was Bursar and – also typically – Hayek volunteered for
fi re duty. That is, he offered to spend his nights sitting on the roof
of his college watching out for marauding German bombers.
It was while he sat out there at night that he began to wonder
about what would happen to his adopted country if and when
peace came. It was clear to Hayek that victory held the seeds of its
own destruction. The war was called ‘the People’s War’ because
– unlike most previous wars – the whole population had fought
in one way or another. Even pacifi sts contributed by working the
land to feed the troops. Hayek detected a growing sense of ‘As in
war, so in peace’ – namely that the government would own, plan
and control everything. The economic diffi culties created by the
war would be immense: people would turn to government for a
way out. And so, as Hayek penned his great classic, The Road to
Serfdom, he was moved not only by a love for his adopted country
but also by a great fear that national planning, that socialism, that
the growth of state power and control would, inevitably, lead the
UK and the US to fascism, or rather National Socialism.
i n t roduction
23
3 J. M. Keynes, A Treatise on Money, Macmillan, London, 1930.
My story begins with a young Englishman named Lionel
Robbins, later Lord Robbins of Clare Market. In 1929, at the age
of only 30, he had been appointed Professor of Economics at the
London School of Economics and Political Science (LSE), a college
of the University of London. He was arguably the greatest English
economist of his generation, and he was fl uent in German. This
skill alerted him to the work of a young Austrian economist,
Friedrich Hayek, and he invited his equally young counterpart
to lecture at the LSE. Such was the success of these lectures that
Hayek was appointed Tooke Professor of Economic Science and
Statistics at the LSE in 1931, and became an English citizen long
before such status had become a ‘passport of convenience’.
In the 1930s John Maynard Keynes was in full fl ow. He was
the most famous economist in the world, and Hayek was his only
real rival. In 1936 Keynes published his infamous General Theory of
Employment, Interest and Money.2 Hayek was tempted to demolish
this nonsense but he held back, for a very simple and very human
reason. Two years earlier, a now forgotten Keynesian tract (A
INTRODUCTION
HAYEK, FISHER AND
THE ROAD TO SERFDOM1
1 This introduction is based on a speech given by the author on 26 April 1999
to the 33rd International Workshop ‘Books for a Free Society’ of the Atlas
Economic Research Foundation (Fairfax, VA) in Philadelphia, PA.
2 J. M. Keynes, The General Theory of Employment, Interest and Money, Macmillan,
London, 1936.
upon row of years – decades even – of copies of Reader’s Digest.
So how did our fi ghter pilot Fisher come across our academic
Hayek? What follows is the story I have pieced together. Not all
parts of it are accepted by all interested parties, but the pieces do
fi t. So this is my story and I’m sticking to it.
The marriage of true minds
The Road to Serfdom was published in March 1944 and, despite
wartime paper shortages, it went through fi ve reprints in the UK
in 15 months. In spite of this, owing to wartime paper rationing,
the publishers, Routledge, were unable to keep up with demand
and Hayek complained that The Road to Serfdom had acquired
a reputation for being ‘that unobtainable book’.4 It was such an
incredible hit that Hayek lost track of the reviews and critics were
moved to write whole books attacking him in both the UK and
the US. Dr Laurence Hayek, only son of F. A. Hayek, owns his late
father’s own fi rst edition copy of The Road to Serfdom as well as the
printers’ proof copy with Hayek’s corrections. On the inside back
cover of the former Hayek began listing the reviews as they came
out. The list reads as follows:
Tablet 11/3/44 (Douglas Woodruff)
Sunday Times 12/3 (Harold Hobson one
or two sentences)
9/4 (G. M. Young)
Birmingham Post 14/3 (TWH)
i n t roduction
25
4 Quoted in R. Cockett, Thinking the Unthinkable: Think Tanks and the Economic
Counter-Revolution, 1931–1983, Fontana, London, 1995, p. 85.
Antony Fisher, the man who did
So let me talk now about The Road to Serfdom and one man in
particular who was moved by its lessons to do something. That
man is the late Antony George Anson Fisher, or AGAF as we
referred to him, and still do.
Fisher came from a family of mine owners, members of parliament,
migrants and military men. He was born in 1915 and soon
followed by his brother and best friend Basil. His father was killed
by a Turkish sniper in 1917. Brought up in South East England by
his young widowed mother, an independent New Zealander from
Piraki, Akaroa, AGAF attended Eton and Cambridge, where he
and his brother both learnt to fl y in the University Air Squadron.
On graduating, Antony’s several initiatives included:
• a car rental fi rm – a success
• a plane rental fi rm – also a success; and
• the design and manufacture of a cheap sports car called the
Deroy – a failure because of a lack of power.
At the start of the war Antony and Basil volunteered for the
RAF and were soon fl ying Hurricanes in III Squadron in the Battle
of Britain. One day Basil’s plane was hit by German fi re. He bailed
out over Selsey Bill but his parachute was on fi re and both plane
and man plummeted to the ground, separately.
A totally devastated Antony was grounded for his own safety,
but used his time productively to develop a machine (the Fisher
Trainer) to teach trainee pilots to shoot better. He was also an avid
reader of Reader’s Digest. Every copy was devoured, read aloud to
his family, heavily underlined and kept in order in his study. His
fi rst child, Mark, recalls a wall of Antony’s study lined with row
t h e roa d to serfdom
24
i n t roduction
27
coincide with the US book publication. He arrived to fi nd himself
a celebrity:
. . . I was told all our plans were changed: I would be going
on a nationwide lecture tour beginning at NY Town Hall . . .
Imagine my surprise when they drove me there the next
day and there were 3,000 people in the hall, plus a few
score more in adjoining rooms with loudspeakers. There I
was, with this battery of microphones and a veritable sea of
expectant faces .6
Now I get to the detective work. That late spring/early summer
of 1945 saw both Hayek and Fisher on the move. Hayek had spent
the whole of the war at Cambridge but now it was safe for the
LSE to return to London. Fisher had spent the war stationed all
over the UK training pilots in gunnery and rising to the rank of
Squadron Leader. He too was on the move to the War Offi ce (now
the Ministry of Defence) in central London, just a ten-minute walk
from the LSE. Laurence Hayek and the LSE both confi rm the dates
of Hayek’s move, while Fisher’s RAF record, recently obtained
from the Ministry of Defence by his elder son Mark, clearly dates
his.
Forty years later both Hayek and Fisher were not overly
helpful about exactly what happened next. Hayek in particular
used to claim he had absolutely no recollection whatsoever of
Fisher ever coming to him for advice. Fisher on the other hand was
always very clear and very consistent about the dialogue – almost
verbatim – but not so helpful on exactly how it happened. Here is
how I believe it came about.
6 Interview with Hayek in The Times, 5 May 1985, quoted in Cockett, op. cit.,
pp. 100–101.
Yorkshire Post 29/3
Financial News 30/3
Listener 30/3
Daily Sketch 30/3 (Candidus)
Times Literary Supplement 1/4
Spectator 31/3 (M. Polanyi)
Irish Times 25/3
Observer 9/4 (George Orwell)
Manchester Guardian 19/4 (W)
But, as Hayek said to me in 1975, they started coming so fast he
lost track and stopped recording them.
In early 1945 the University of Chicago Press published the
US edition of The Road to Serfdom and, like Routledge in the UK,
found themselves unable to meet the demand for copies owing to
paper rationing. However, in April 1945 the book fi nally reached a
mass audience when the Reader’s Digest published their condensed
version.5 (Hayek thought it impossible to condense but always
commented on what a great job the Reader’s Digest editors did.)
Whereas the book publishers had been dealing in issues of four or
fi ve thousand copies, the Reader’s Digest had a print run which was
measured in hundreds of thousands. For the fi rst and still the only
time, they put the condensed book at the front of the magazine
where nobody could miss it – particularly a Digest junkie like
Fisher.
The Reader’s Digest appeared while Hayek was on board a ship
en route to the USA for a lecture tour which had been arranged to
t h e roa d to serfdom
26
5 John Blundell discusses the contents of that issue of the Reader’s Digest in detail
in ‘Looking back at the condensed version of The Road to Serfdom after 60 years’,
Economic Affairs, Vol. 24, No. 1.
Finally on this issue, let me quote Fisher’s own words of 3
July 1985 when he spoke at a party at the IEA to celebrate its 30th
birthday. (This would have been the 30th anniversary of the IEA’s
fi rst book in June 1955 rather than incorporation in November 1955
or the actual opening in 1957.) At that party in July 1985 Fisher said:
It was quite a day for me when Friedrich Hayek gave me
some advice which must be 40 years ago almost to the day and
which completely changed my life. Friedrich got me started
. . . and two of the things he said way back are the things
which have kept the IEA on course. One is to keep out of
politics and the other is to make an intellectual case . . . if
you can stick to these rules you keep out of a lot of trouble
and apparently do a lot of good.
As I said, 30 years later, on countless occasions, Hayek did not
dispute the event or disown the advice, he simply said he could not
remember. But it is of course very Hayekian advice and very much
in keeping with his classic essay ‘The Intellectuals and Socialism’,
which came out just a few years later and which has just been
republished by the IEA.8 This was hardly a blueprint for action
– ‘reach the intellectuals’ – and indeed the next decade saw little
direct fallout from that conversation, although three American
intellectual entrepreneurs who had also sought out Hayek did get
the ball rolling in the US.
The road to the IEA
Hayek taught at the LSE, got divorced in Arkansas, remarried,
moved to Chicago and wrote The Constitution of Liberty.
i n t roduction
29
8 F. A. Hayek, The Intellectuals and Socialism, Rediscovered Riches No. 4, IEA, London,
1998.
Fisher, the Digest junkie, is already politically active and is also
worried about the future for his country. The April 1945 edition
lands on his desk as he is moving to London and, after reading the
cover story, he notes on the front that the author is at the University
of London. A phone call establishes that the LSE is back in
place and, one lunchtime or late one afternoon, Fisher makes the
short walk from his offi ce to the LSE and knocks on Hayek’s door.
Fisher also recalled the physical setting of Hayek’s offi ce in minute
and accurate detail, including its proximity to that of the dreaded
Harold Laski. Fisher claimed that after small talk (which neither
excelled at) the conversation went like this:
Fisher I share all your worries and concerns as expressed in The
Road to Serfdom and I’m going to go into politics and put it
all right.
Hayek No you’re not! Society’s course will be changed only by a
change in ideas. First you must reach the intellectuals, the
teachers and writers, with reasoned argument. It will be
their infl uence on society which will prevail, and the politicians
will follow.
I have this quote framed above my desk alongside Keynes’s
famous line: ‘The ideas of economists and political philosophers,
both when they are right and when they are wrong, are more
powerful than is commonly understood. Indeed the world is ruled
by little else. Practical men, who believe themselves to be quite
exempt from any intellectual infl uences, are usually the slaves of
some defunct economist.’7
t h e roa d to serfdom
28
7 Keynes, The General Theory of Employment, Interest and Money, op. cit., p. 383.
distinctive IEA approach of short monographs containing the very
best economics in good, jargon-free English, written by academics
(mostly) or quasi-academics, in language accessible to the layman
but still of use to the expert.
In the early days it was hard to fi nd authors, hard to raise
money and hard to get reviews and sales. At times everybody had
to down pens to raise money or quickly pick up pens to co-author
a paper. The fi rst clear success of this venture – inspired by The
Road to Serfdom, advised by Hayek, implemented by Fisher and
run by Harris and Seldon – was the repeal of Resale Price Maintenance
in 1964, a fantastic reform. It effectively outlawed the
prevailing practice by which manufacturers priced goods – they
literally stamped the price on the article – and discounting was
illegal. There was no such thing as shopping around. This change
alienated the small-business vote and put the Tories out for six
years, but it transformed the UK economy and allowed a nation
of shopkeepers to spread their wings. It was clearly heralded by
a 1960 IEA study, Resale Price Maintenance and Shoppers’ Choice
by Basil Yamey.11 Other successes followed and the IEA’s impetus
grew, but what was happening to Hayek and Fisher?
Hayek had moved from Chicago back to Europe, and in
December 1974 received the Nobel Prize. He was 75 and his health
had not been good. He was also depressed. However the prize
(and the big cheque) cheered him up no end.
Fisher had sold the chicken business for millions and had put a
large part of his minority share into an experimental turtle farm in
the Cayman Islands. Well, the experiment worked brilliantly but
i n t roduction
31
11 B. S. Yamey, Resale Price Maintenance and Shoppers’ Choice, Hobart Paper No. 1,
IEA, London, 1960.
Fisher tried stockbroking, became a farmer, wrote a very
prescient monograph, ‘The Case for Freedom’,9 imported the
idea of factory-farming of chickens, championed liberty in many
different campaigns, visited the US looking for institute models he
could copy, published The Free Convertibility of Sterling by George
Winder,10 incorporated the Institute of Economic Affairs, hired
Ralph Harris and, as he always did, having hired the talent let
it rip with a very hands-off approach to management. (When in
1987 he entrusted to me the future of the Atlas Economic Research
Foundation, the body dedicated to building new IEAs around the
world, he made it very clear that he was there if I wanted his help
but that he really did expect me to crack on on my own.)
To begin with, in the late 1950s, it was not at all clear what the
IEA would do. The exchange control book by Winder had been
short, easily understood and on a fairly narrow but important
topic. It had sold out its 2,000 print run very quickly because of
Henry Hazlitt’s review in Newsweek. Unfortunately the printer who
had also sold the book for Antony went bankrupt, and the 2,000
names and addresses of the purchasers were lost. But Fisher had
visited the Foundation for Economic Education in Irvington- on-
Hudson, New York, had been exposed to its magazine, The Freeman,
and still adored Reader’s Digest. Harris had been a party political
man turned academic turned editorial writer, while Arthur
Seldon, the fi rst editorial director, had been a research assistant
to the famous LSE economist Arnold Plant before becoming chief
economist of a brewers’ association. Out of this mish-mash of
experiences – academic, business, political, journalistic – came the
t h e roa d to serfdom
30
9 A. Fisher, The Case for Freedom, Runnymede Press, London, undated.
10 G. Winder, The Free Convertibility of Sterling, The Batchworth Press for the Institute
of Economic Affairs, London, 1955.
Fisher incorporated the Atlas Economic Research Foundation to
be a focal point for institutes and to channel funds to start-ups. By
the time of his death in 1988 we listed 30-plus institutes in 20 or so
countries. By 1991 we were listing 80 and I now count about 100 in
76 countries.
All of this can be traced back to this young economist, his
book, the Reader’s Digest condensation, and a young RAF offi cer
. . . through the IEA . . . through CIS/PRI/ASI/Manhattan and
Fraser . . . to 100 institutes in 76 countries today, who together are
literally changing the world.
To illustrate our impact, let me fi nish with a story from Lord
Howell of Guildford, a minister in the 1980s. He came into my
offi ce recently and pointed at the big boardroom table where
I work every day and which was donated by Antony in the late
1960s. Howell said: ‘You know, John, it was at that table that we
fi rst got serious about privatisation in 1968. The idea fi zzled in the
1970s, took off in the 1980s and in the 1990s burns brightly around
the world.’ I replied: ‘Yes, it burns so brightly that last year worldwide
privatisation revenues topped $100 billion for the fi rst time.’
So it is quite a story we have to tell and it all begins here with
the condensed version of The Road to Serfdom and the cartoon
version drawn to my attention only recently by Laurence Hayek.
Read the condensed version, now published in our ‘Rediscovered
Riches’ series for the fi rst time since its original appearance in the
Reader’s Digest, and wonder on all the changes it led to: all the
misery avoided and all the prosperity created.
j o h n b l u n d e l l
November 1999
i n t roduction
33
the environmentalists closed down his largest market – the US.12
He refused to hide behind limited liability and used the balance of
his fortune to pay off all debts.
1974 – now 30 years after The Road to Serfdom – was a big year
for Fisher too, because, free from business concerns, he was able to
respond to businessmen and others around the world who noted
the IEA’s growing infl uence and came to him for advice.
Sowing the seed
So the entrepreneur turned fi ghter pilot turned gunnery trainer
turned stockbroker turned dairy farmer turned chicken pioneer
turned turtle saviour became the Johnny Appleseed of the freemarket
movement, going all over the world and setting up new
IEA-type operations.
First he joined the very young Fraser Institute in Vancouver,
BC; quickly moved on to help Greg Lindsay and the Centre for
Independent Studies in Australia; hired David Theroux, recently
departed from the Cato Institute, to set up the Pacifi c Research
Institute in San Francisco; gave support to the Butler brothers
and Madsen Pirie as they founded the Adam Smith Institute in
London; and incorporated with William Casey the Manhattan
Institute where, as they did so, they sat on movers’ boxes in an
otherwise empty offi ce.
It took ten years to give birth to Institute No. 1 – the IEA. For
all but twenty years it was the only one in the family; in just six
years fi ve more were born, and then the fun really started. In 1981
t h e roa d to serfdom
32
12 For a full account see P. and S. Fosdick, Last Chance Lost: Can and Should Farming
Save the Green Sea Turtle?, Irvin S. Naylor, York, PA, 1994.
• Is there a greater tragedy imaginable than that in our
endeavour consciously to shape our future in accordance with
high ideals we should in fact unwittingly produce the very
opposite of what we have been striving for?
• The contention that only the peculiar wickedness of the
Germans has produced the Nazi system is likely to become
the excuse for forcing on us the very institutions which have
produced that wickedness.
• Totalitarianism is the new word we have adopted to describe
the unexpected but nevertheless inseparable manifestations
of what in theory we call socialism.
• In a planned system we cannot confi ne collective action to the
tasks on which we agree, but are forced to produce agreement
on everything in order that any action can be taken at all.
• The more the state ‘plans’ the more diffi cult planning
becomes for the individual.
• The economic freedom which is the prerequisite of any other
freedom cannot be the freedom from economic care which
the socialists promise us and which can be obtained only by
relieving the individual at the same time of the necessity and
of the power of choice: it must be the freedom of economic
activity which, with the right of choice, inevitably also carries
the risk and the responsibility of that right.
35
SUMMARY
(Jacket notes written by Hayek for the first edition)
‘In The Road to Serfdom’, writes Henry Hazlitt in the New York
Times, ‘Friedrich A. Hayek has written one of the most important
books of our generation. It restates for our time the issue between
liberty and authority. It is an arresting call to all well-intentioned
planners and socialists, to all those who are sincere democrats and
liberals at heart, to stop, look and listen.’
The author is an internationally known economist. An Austrian
by birth, he was director of the Austrian Institute for Economic
Research and lecturer in economics at the University of Vienna
during the years of the rise of fascism in Central Europe. He has
lived in England since 1931 when he became Professor of Economic
Science at the University of London, and is now a British citizen.
Professor Hayek, with great power and rigour of reasoning,
sounds a grim warning to Americans and Britons who look to the
government to provide the way out of all our economic diffi culties.
He demonstrates that fascism and what the Germans correctly
call National Socialism are the inevitable results of the increasing
growth of state control and state power, of national ‘planning’ and
of socialism.
In a foreword to The Road to Serfdom John Chamberlain, book
editor of Harper’s, writes: ‘This book is a warning cry in a time of
hesitation. It says to us: Stop, look and listen. Its logic is incontestable,
and it should have the widest possible audience.’
34
PREFACE TO THE READER’S DIGEST
CONDENSED VERSION OF
THE ROAD TO SERFDOM
The Reader’s Digest condensed version of
The Road to Serfdom
• What our generation has forgotten is that the system of
private property is the most important guarantee of freedom,
not only for those who own property, but scarcely less for
those who do not.
• We shall never prevent the abuse of power if we are not
prepared to limit power in a way which occasionally may
prevent its use for desirable purposes.
• We shall all be the gainers if we can create a world fi t for small
states to live in.
• The fi rst need is to free ourselves of that worst form of
contemporary obscurantism which tries to persuade us that
what we have done in the recent past was all either wise or
unavoidable. We shall not grow wiser before we learn that
much that we have done was very foolish.
t h e roa d to serfdom
36
The author has spent about half his adult life in his native
Austria, in close touch with German thought, and the other half in
the United States and England. In the latter period he has become
increasingly convinced that some of the forces which destroyed
freedom in Germany are also at work here.
The very magnitude of the outrages committed by the National
Socialists has strengthened the assurance that a totalitarian
system cannot happen here. But let us remember that 15 years ago
the possibility of such a thing happening in Germany would have
appeared just as fantastic not only to nine-tenths of the Germans
themselves, but also to the most hostile foreign observer.
There are many features which were then regarded as ‘typically
German’ which are now equally familiar in America and England,
and many symptoms that point to a further development in the
same direction: the increasing veneration for the state, the fatalistic
acceptance of ‘inevitable trends’, the enthusiasm for ‘organization’
of everything (we now call it ‘planning’).
The character of the danger is, if possible, even less understood
here than it was in Germany. The supreme tragedy is still not seen
that in Germany it was largely people of good will who, by their
socialist policies, prepared the way for the forces which stand
for everything they detest. Few recognize that the rise of fascism
and Marxism was not a reaction against the socialist trends of the
39
THE ROAD TO SERFDOM
(condensed version, published in the Reader’s Digest,
April 1945 edition)
of some single body power formerly exercised independently by
many, an amount of power is created infi nitely greater than any
that existed before, so much more far-reaching as almost to be
different in kind.
It is entirely fallacious to argue that the great power exercised
by a central planning board would be ‘no greater than the power
collectively exercised by private boards of directors’. There is, in
a competitive society, nobody who can exercise even a fraction
of the power which a socialist planning board would possess. To
decentralize power is to reduce the absolute amount of power, and
the competitive system is the only system designed to minimize
the power exercised by man over man. Who can seriously doubt
that the power which a millionaire, who may be my employer, has
over me is very much less than that which the smallest bureaucrat
possesses who wields the coercive power of the state and on whose
discretion it depends how I am allowed to live and work?
In every real sense a badly paid unskilled workman in this
country has more freedom to shape his life than many an employer
in Germany or a much better paid engineer or manager in Russia.
If he wants to change his job or the place where he lives, if he
wants to profess certain views or spend his leisure in a particular
way, he faces no absolute impediments. There are no dangers to
bodily security and freedom that confi ne him by brute force to the
task and environment to which a superior has assigned him.
Our generation has forgotten that the system of private
property is the most important guarantee of freedom. It is only
because the control of the means of production is divided among
many people acting independently that we as individuals can
decide what to do with ourselves. When all the means of production
are vested in a single hand, whether it be nominally that of
t h e roa d to serfdom
41
preceding period but a necessary outcome of those tendencies. Yet it
is signifi cant that many of the leaders of these movements, from
Mussolini down (and including Laval and Quisling) began as
socialists and ended as fascists or Nazis.
In the democracies at present, many who sincerely hate all of
Nazism’s manifestations are working for ideals whose realization
would lead straight to the abhorred tyranny. Most of the people
whose views infl uence developments are in some measure socialists.
They believe that our economic life should be ‘consciously
directed’, that we should substitute ‘economic planning’ for the
competitive system. Yet is there a greater tragedy imaginable than
that, in our endeavour consciously to shape our future in accordance
with high ideals, we should in fact unwittingly produce the
very opposite of what we have been striving for?
Planning and power
In order to achieve their ends the planners must create power
– power over men wielded by other men – of a magnitude never
before known. Their success will depend on the extent to which
they achieve such power. Democracy is an obstacle to this suppression
of freedom which the centralized direction of economic
activity requires. Hence arises the clash between planning and
democracy.
Many socialists have the tragic illusion that by depriving
private individuals of the power they possess in an individualist
system, and transferring this power to society, they thereby extinguish
power. What they overlook is that by concentrating power
so that it can be used in the service of a single plan, it is not merely
transformed, but infi nitely heightened. By uniting in the hands
t h e roa d to serfdom
40
independence which 100 years before had hardly seemed possible.
The effect of this success was to create among men a new sense
of power over their own fate, the belief in the unbounded possibilities
of improving their own lot. What had been achieved came
to be regarded as a secure and imperishable possession, acquired
once and for all; and the rate of progress began to seem too slow.
Moreover the principles which had made this progress possible
came to be regarded as obstacles to speedier progress, impatiently
to be brushed away. It might be said that the very success of liberalism
became the cause of its decline.
No sensible person should have doubted that the economic
principles of the nineteenth century were only a beginning – that
there were immense possibilities of advancement on the lines on
which we had moved. But according to the views now dominant,
the question is no longer how we can make the best use of the
spontaneous forces found in a free society. We have in effect
undertaken to dispense with these forces and to replace them by
collective and ‘conscious’ direction.
It is signifi cant that this abandonment of liberalism, whether
expressed as socialism in its more radical form or merely as
‘organization’ or ‘planning’, was perfected in Germany. During
the last quarter of the nineteenth century and the fi rst quarter of
the twentieth, Germany moved far ahead in both the theory and
the practice of socialism, so that even today Russian discussion
largely carries on where the Germans left off. The Germans, long
before the Nazis, were attacking liberalism and democracy, capitalism,
and individualism.
Long before the Nazis, too, the German and Italian socialists
were using techniques of which the Nazis and fascists later
made effective use. The idea of a political party which embraces
t h e roa d to serfdom
43
‘society’ as a whole or that of a dictator, whoever exercises this
control has complete power over us. In the hands of private individuals,
what is called economic power can be an instrument of
coercion, but it is never control over the whole life of a person. But
when economic power is centralized as an instrument of political
power it creates a degree of dependence scarcely distinguishable
from slavery. It has been well said that, in a country where the sole
employer is the state, opposition means death by slow starvation.
Background to danger
Individualism, in contrast to socialism and all other forms of
totalitarianism, is based on the respect of Christianity for the
individual man and the belief that it is desirable that men should
be free to develop their own individual gifts and bents. This philosophy,
fi rst fully developed during the Renaissance, grew and
spread into what we know as Western civilization. The general
direction of social development was one of freeing the individual
from the ties which bound him in feudal society.
Perhaps the greatest result of this unchaining of individual
energies was the marvellous growth of science. Only since industrial
freedom opened the path to the free use of new knowledge,
only since everything could be tried – if somebody could be found
to back it at his own risk – has science made the great strides which
in the last 150 years have changed the face of the world. The result
of this growth surpassed all expectations. Wherever the barriers to
the free exercise of human ingenuity were removed, man became
rapidly able to satisfy ever-widening ranges of desire. By the beginning
of the twentieth century the working man in the Western world
had reached a degree of material comfort, security and personal
t h e roa d to serfdom
42
The liberal way of planning
‘Planning’ owes its popularity largely to the fact that everybody
desires, of course, that we should handle our common problems
with as much foresight as possible. The dispute between the
modern planners and the liberals is not on whether we ought to
employ systematic thinking in planning our affairs. It is a dispute
about what is the best way of so doing. The question is whether we
should create conditions under which the knowledge and initiative
of individuals are given the best scope so that they can plan
most successfully; or whether we should direct and organize all
economic activities according to a ‘blueprint’, that is, ‘consciously
direct the resources of society to conform to the planners’ particular
views of who should have what’.
It is important not to confuse opposition against the latter
kind of planning with a dogmatic laissez faire attitude. The liberal
argument does not advocate leaving things just as they are; it
favours making the best possible use of the forces of competition
as a means of coordinating human efforts. It is based on the
conviction that, where effective competition can be created, it is a
better way of guiding individual efforts than any other. It emphasizes
that in order to make competition work benefi cially a carefully
thought-out legal framework is required, and that neither the
past nor the existing legal rules are free from grave defects.
Liberalism is opposed, however, to supplanting competition
by inferior methods of guiding economic activity. And it regards
competition as superior not only because in most circumstances
it is the most effi cient method known but because it is the only
method which does not require the coercive or arbitrary intervention of
authority. It dispenses with the need for ‘conscious social control’
and gives individuals a chance to decide whether the prospects of
t h e roa d to serfdom
45
all activities of the individual from the cradle to the grave, which
claims to guide his views on everything, was fi rst put into practice
by the socialists. It was not the fascists but the socialists who began
to collect children at the tenderest age into political organizations
to direct their thinking. It was not the fascists but the socialists
who fi rst thought of organizing sports and games, football and
hiking, in party clubs where the members would not be infected
by other views. It was the socialists who fi rst insisted that the
party member should distinguish himself from others by the
modes of greeting and the forms of address. It was they who, by
their organization of ‘cells’ and devices for the permanent supervision
of private life, created the prototype of the totalitarian party.
By the time Hitler came to power, liberalism was dead in
Germany. And it was socialism that had killed it.
To many who have watched the transition from socialism to
fascism at close quarters the connection between the two systems
has become increasingly obvious, but in the democracies the
majority of people still believe that socialism and freedom can
be combined. They do not realize that democratic socialism, the
great utopia of the last few generations, is not only unachievable,
but that to strive for it produces something utterly different – the
very destruction of freedom itself. As has been aptly said: ‘What
has always made the state a hell on earth has been precisely that
man has tried to make it his heaven.’
It is disquieting to see in England and the United States today
the same drawing together of forces and nearly the same contempt
of all that is liberal in the old sense. ‘Conservative socialism’ was
the slogan under which a large number of writers prepared the
atmosphere in which National Socialism succeeded. It is ‘conservative
socialism’ which is the dominant trend among us now.
t h e roa d to serfdom
44
The great utopia
There can be no doubt that most of those in the democracies who
demand a central direction of all economic activity still believe
that socialism and individual freedom can be combined. Yet
socialism was early recognized by many thinkers as the gravest
threat to freedom.
It is rarely remembered now that socialism in its beginnings
was frankly authoritarian. It began quite openly as a reaction
against the liberalism of the French Revolution. The French writers
who laid its foundation had no doubt that their ideas could be put
into practice only by a strong dictatorial government. The fi rst of
modern planners, Saint-Simon, predicted that those who did not
obey his proposed planning boards would be ‘treated as cattle’.
Nobody saw more clearly than the great political thinker de
Tocqueville that democracy stands in an irreconcilable confl ict
with socialism: ‘Democracy extends the sphere of individual
freedom,’ he said. ‘Democracy attaches all possible value to each
man,’ he said in 1848, ‘while 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.’
To allay these suspicions and to harness to its cart the strongest
of all political motives – the craving for freedom – socialists began
increasingly to make use of the promise of a ‘new freedom’.
Socialism was to bring ‘economic freedom’ without which political
freedom was ‘not worth having’.
To make this argument sound plausible, the word ‘freedom’
was subjected to a subtle change in meaning. The word had
formerly meant freedom from coercion, from the arbitrary power
t h e roa d to serfdom
47
a particular occupation are suffi cient to compensate for the disadvantages
connected with it.
The successful use of competition does not preclude some types
of government interference. For instance, to limit working hours,
to require certain sanitary arrangements, to provide an extensive
system of social services is fully compatible with the preservation
of competition. There are, too, certain fi elds where the system of
competition is impracticable. For example, the harmful effects of
deforestation or of the smoke of factories cannot be confi ned to the
owner of the property in question. But the fact that we have to resort
to direct regulation by authority where the conditions for the proper
working of competition cannot be created does not prove that we
should suppress competition where it can be made to function.
To create conditions in which competition will be as effective as
possible, to prevent fraud and deception, to break up monopolies
– these tasks provide a wide and unquestioned fi eld for state activity.
This does not mean that it is possible to fi nd some ‘middle
way’ between competition and central direction, though nothing
seems at fi rst more plausible, or is more likely to appeal to reasonable
people. Mere common sense proves a treacherous guide in
this fi eld. Although competition can bear some mixture of regulation,
it cannot be combined with planning to any extent we like
without ceasing to operate as an effective guide to production.
Both competition and central direction become poor and ineffi -
cient tools if they are incomplete, and a mixture of the two means
that neither will work.
Planning and competition can be combined only by planning
for competition, not by planning against competition. The
planning against which all our criticism is directed is solely the
planning against competition.
t h e roa d to serfdom
46
reserved for each other the hatred of the heretic. Their practice
showed how closely they are related. To both, the real enemy, the
man with whom they had nothing in common, was the liberal of
the old type. While to the Nazi the communist and to the communist
the Nazi, and to both the socialist, are potential recruits
made of the right timber, they both know that there can be no
com promise between them and those who really believe in individual
freedom.
What is promised to us as the Road to Freedom is in fact the
Highroad to Servitude. For it is not diffi cult to see what must be
the consequences when democracy embarks upon a course of
planning. The goal of the planning will be described by some such
vague term as ‘the general welfare’. There will be no real agreement
as to the ends to be attained, and the effect of the people’s
agreeing that there must be central planning, without agreeing
on the ends, will be rather as if a group of people were to commit
themselves to take a journey together without agreeing where
they want to go: with the result that they may all have to make a
journey which most of them do not want at all.
Democratic assemblies cannot function as planning agencies.
They cannot produce agreement on everything – the whole direction
of the resources of the nation – for the number of possible
courses of action will be legion. Even if a congress could, by
proceeding step by step and compromising at each point, agree on
some scheme, it would certainly in the end satisfy nobody.
To draw up an economic plan in this fashion is even less
possible than, for instance, successfully to plan a military
campaign by democratic procedure. As in strategy, it would
become inevitable to delegate the task to experts. And even if,
by this expedient, a democracy should succeed in planning every
t h e roa d to serfdom
49
of other men. Now it was made to mean freedom from necessity,
release from the compulsion of the circumstances which inevitably
limit the range of choice of all of us. Freedom in this sense is, of
course, merely another name for power or wealth. The demand for
the new freedom was thus only another name for the old demand
for a redistribution of wealth.
The claim that a planned economy would produce a substantially
larger output than the competitive system is being progressively
abandoned by most students of the problem. Yet it is this
false hope as much as anything which drives us along the road to
planning.
Although our modern socialists’ promise of greater freedom
is genuine and sincere, in recent years observer after observer has
been impressed by the unforeseen consequences of socialism, the
extraordinary similarity in many respects of the conditions under
‘communism’ and ‘fascism’. As the writer Peter Drucker expressed
it in 1939, ‘the complete collapse of the belief in the attainability
of freedom and equality through Marxism has forced Russia to
travel the same road toward a totalitarian society of unfreedom
and inequality which Germany has been following. Not that
communism and fascism are essentially the same. Fascism is the
stage reached after communism has proved an illusion, and it has
proved as much an illusion in Russia as in pre-Hitler Germany.’
No less signifi cant is the intellectual outlook of the rank and
fi le in the communist and fascist movements in Germany before
1933. The relative ease with which a young communist could be
converted into a Nazi or vice versa was well known, best of all to
the propagandists of the two parties. The communists and Nazis
clashed more frequently with each other than with other parties
simply because they competed for the same type of mind and
t h e roa d to serfdom
48
sacrifi ce freedom in order to make it more secure in the future,
but it is quite a different thing to sacrifi ce liberty permanently in
the interests of a planned economy.
To those who have watched the transition from socialism to
fascism at close quarters, the connection between the two systems
is obvious. The realization of the socialist programme means the
destruction of freedom. Democratic socialism, the great utopia of
the last few generations, is simply not achievable.
Why the worst get on top
No doubt an American or English ‘fascist’ system would greatly
differ from the Italian or German models; no doubt, if the transition
were effected without violence, we might expect to get a
better type of leader. Yet this does not mean that our fascist
system would in the end prove very different or much less intolerable
than its prototypes. There are strong reasons for believing
that the worst features of the totalitarian systems are phenomena
which totalitarianism is certain sooner or later to produce.
Just as the democratic statesman who sets out to plan
economic life will soon be confronted with the alternative of either
assuming dictatorial powers or abandoning his plans, so the
totalitarian leader would soon have to choose between disregard
of ordinary morals and failure. It is for this reason that the unscrupulous
are likely to be more successful in a society tending toward
totalitarianism. Who does not see this has not yet grasped the full
width of the gulf which separates totalitarianism from the essentially
individualist Western civilization.
The totalitarian leader must collect around him a group which
is prepared voluntarily to submit to that discipline they are to
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51
sector of economic activity, it would still have to face the problem
of integrating these separate plans into a unitary whole. There
will be a stronger and stronger demand that some board or some
single individual should be given powers to act on their own
responsibility. The cry for an economic dictator is a characteristic
stage in the movement toward planning.
Thus the legislative body will be reduced to choosing the
persons who are to have practically absolute power. The whole
system will tend toward that kind of dictatorship in which the
head of government is from time to time confi rmed in his position
by popular vote, but where he has all the power at his command to
make certain that the vote will go in the direction that he desires.
Planning leads to dictatorship because dictatorship is the most
effective instrument of coercion and, as such, essential if central
planning on a large scale is to be possible. There is no justifi cation
for the widespread belief that, so long as power is conferred by
democratic procedure, it cannot be arbitrary; it is not the source of
power which prevents it from being arbitrary; to be free from dictatorial
qualities, the power must also be limited. A true ‘dictatorship
of the proletariat’, even if democratic in form, if it undertook
centrally to direct the economic system, would probably destroy
personal freedom as completely as any autocracy has ever done.
Individual freedom cannot be reconciled with the supremacy
of one single purpose to which the whole of society is permanently
subordinated. To a limited extent we ourselves experience this
fact in wartime, when subordination of almost everything to the
immediate and pressing need is the price at which we preserve our
freedom in the long run. The fashionable phrases about doing for
the purposes of peace what we have learned to do for the purposes
of war are completely misleading, for it is sensible temporarily to
t h e roa d to serfdom
50
gain the support of the docile and gullible, who have no strong
convictions of their own but are ready to accept a ready-made
system of values if it is only drummed into their ears suffi ciently
loudly and frequently. It will be those whose vague and imperfectly
formed ideas are easily swayed and whose passions and
emotions are readily aroused who will thus swell the ranks of the
totalitarian party.
Third, to weld together a closely coherent body of supporters,
the leader must appeal to a common human weakness. It seems
to be easier for people to agree on a negative programme – on the
hatred of an enemy, on the envy of the better off – than on any
positive task.
The contrast between the ‘we’ and the ‘they’ is consequently
always employed by those who seek the allegiance of huge masses.
The enemy may be internal, like the ‘Jew’ in Germany or the
‘kulak’ in Russia, or he may be external. In any case, this technique
has the great advantage of leaving the leader greater freedom of
action than would almost any positive programme.
Advancement within a totalitarian group or party depends
largely on a willingness to do immoral things. The principle
that the end justifi es the means, which in individualist ethics is
regarded as the denial of all morals, in collectivist ethics becomes
necessarily the supreme rule. There is literally nothing which the
consistent collectivist must not be prepared to do if it serves ‘the
good of the whole’, because that is to him the only criterion of
what ought to be done.
Once you admit that the individual is merely a means to
serve the ends of the higher entity called society or the nation,
most of those features of totalitarianism which horrify us follow
of necessity. From the collectivist standpoint intolerance and
t h e roa d to serfdom
53
impose by force upon the rest of the people. That socialism can
be put into practice only by methods of which most socialists
dis approve 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 respon sibilities
of government. They were unwilling whole heartedly to
employ the methods to which they had pointed the way. They
still hoped for the miracle of a majority’s agreeing on a particular
plan for the organization of the whole of society. Others had
already learned the lesson that in a planned society the question
can no longer be on what do a majority of the people agree but
what the largest single group is whose members agree suffi ciently
to make unifi ed direction of all affairs possible.
There are three main reasons why such a numerous group,
with fairly similar views, is not likely to be formed by the best but
rather by the worst elements of any society.
First, the higher the education and intelligence of individuals
become, the more their tastes and views are differentiated. If we
wish to fi nd a high degree of uniformity in outlook, we have to
descend to the regions of lower moral and intellectual standards
where the more primitive instincts prevail. This does not mean
that the majority of people have low moral standards; it merely
means that the largest group of people whose values are very
similar are the people with low standards.
Second, since this group is not large enough to give suffi cient
weight to the leader’s endeavours, he will have to increase their
numbers by converting more to the same simple creed. He must
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52
The most effective way of making people accept the validity
of the values they are to serve is to persuade them that they are
really the same as those they have always held, but which were
not properly understood or recognized before. And the most effi -
cient technique to this end is to use the old words but change their
meaning. Few traits of totalitarian regimes are at the same time
so confusing to the superfi cial observer and yet so characteristic
of the whole intellectual climate as this complete perversion of
language.
The worst sufferer in this respect is the word ‘liberty’. It is a
word used as freely in totalitarian states as elsewhere. Indeed,
it could almost be said that wherever liberty as we know it has
been destroyed, this has been done in the name of some new
freedom promised to the people. Even among us we have planners
who promise us a ‘collective freedom’, which is as misleading as
anything said by totalitarian politicians. ‘Collective freedom’ is not
the freedom of the members of society, but the unlimited freedom
of the planner to do with society that which he pleases. This is the
confusion of freedom with power carried to the extreme.
It is not diffi cult to deprive the great majority of independent
thought. But the minority who will retain an inclination to criticize
must also be silenced. Public criticism or even expressions of
doubt must be suppressed because they tend to weaken support
of the regime. As Sidney and Beatrice Webb report of the position
in every Russian enterprise: ‘Whilst the work is in progress, any
public expression of doubt that the plan will be successful is an act
of disloyalty and even of treachery because of its possible effect on
the will and efforts of the rest of the staff.’
Control extends even to subjects which seem to have no political
signifi cance. The theory of relativity, for instance, has been
t h e roa d to serfdom
55
brutal suppression of dissent, deception and spying, the complete
disregard of the life and happiness of the individual are essential
and unavoidable. Acts which revolt all our feelings, such as the
shooting of hostages or the killing of the old or sick, are treated
as mere matters of expediency; the compulsory uprooting and
transportation of hundreds of thousands becomes an instrument
of policy approved by almost everybody except the victims.
To be a useful assistant in the running of a totalitarian state,
therefore, a man must be prepared to break every moral rule he
has ever known if this seems necessary to achieve the end set for
him. In the totalitarian machine there will be special opportunities
for the ruthless and unscrupulous. Neither the Gestapo nor
the administration of a concentration camp, neither the Ministry
of Propaganda nor the SA or SS (or their Russian counterparts)
are suitable places for the exercise of humanitarian feelings. Yet it
is through such positions that the road to the highest positions in
the totalitarian state leads.
A distinguished American economist, Professor Frank H.
Knight, correctly notes that the authorities of a collectivist state
‘would have to do these things whether they wanted to or not:
and the probability of the people in power being individuals who
would dislike the possession and exercise of power is on a level
with the probability that an extremely tender-hearted person
would get the job of whipping master in a slave plantation’.
A further point should be made here: collectivism means the
end of truth. To make a totalitarian system function effi ciently it is
not enough that everybody should be forced to work for the ends
selected by those in control; it is essential that the people should
come to regard these ends as their own. This is brought about by
propaganda and by complete control of all sources of information.
t h e roa d to serfdom
54
and America are those which the progress of collectivism and its
centralistic tendencies are progressively destroying.
Planning vs. the Rule of Law
Nothing distinguishes more clearly a free country from a country
under arbitrary government than the observance in the former of
the great principles known as the Rule of Law. Stripped of technicalities
this means that government in all its actions is bound
by rules fi xed and announced beforehand – rules that make it
possible to foresee with fair certainty how the authority will use
its coercive powers in given circumstances and to plan one’s
individual affairs on the basis of this knowledge. Thus, within
the known rules of the game, the individual is free to pursue his
personal ends, certain that the powers of government will not be
used deliberately to frustrate his efforts.
Socialist economic planning necessarily involves the very
opposite of this. The planning authority cannot tie itself down in
advance to general rules which prevent arbitrariness.
When the government has to decide how many pigs are to
be raised or how many buses are to run, which coal-mines are
to operate, or at what prices shoes are to be sold, these decisions
cannot be settled for long periods in advance. They depend inevitably
on the circumstances of the moment, and in making such
decisions it will always be necessary to balance, one against the
other, the interests of various persons and groups.
In the end somebody’s views will have to decide whose interests
are more important, and these views must become part of
the law of the land. Hence the familiar fact that the more the state
‘plans’, the more diffi cult planning becomes for the individual.
t h e roa d to serfdom
57
opposed as a ‘Semitic attack on the foundation of Christian and
Nordic physics’ and because it is ‘in confl ict with dialectical materialism
and Marxist dogma’. Every activity must derive its justifi cation
from conscious social purpose. There must be no spontaneous,
unguided activity, because it might produce results which cannot
be foreseen and for which the plan does not provide.
The principle extends even to games and amusements. I leave
it to the reader to guess where it was that chess players were
offi cially exhorted that ‘we must fi nish once and for all with the
neutrality of chess. We must condemn once and for all the formula
chess for the sake of chess.’
Perhaps the most alarming fact is that contempt for intellectual
liberty is not a thing which arises only once the totalitarian system
is established, but can be found everywhere among those who have
embraced a collectivist faith. The worst oppression is condoned if it
is committed in the name of socialism. Intolerance of opposing ideas
is openly extolled. The tragedy of collectivist thought is that while it
starts out to make reason supreme, it ends by destroying reason.
There is one aspect of the change in moral values brought
about by the advance of collectivism which provides special food
for thought. It is that the virtues which are held less and less in
esteem in Britain and America are precisely those on which Anglo-
Saxons justly prided themselves and in which they were generally
recognized to excel. These virtues were independence and
self-reliance, individual initiative and local responsibility, the
successful reliance on voluntary activity, non-interference with
one’s neighbour and tolerance of the different, and a healthy
suspicion of power and authority.
Almost all the traditions and institutions which have moulded
the national character and the whole moral climate of England
t h e roa d to serfdom
56
Is planning ‘inevitable’?
It is revealing that few planners today are content to say that
central planning is desirable. Most of them affi rm that we now are
compelled to it by circumstances beyond our control.
One argument frequently heard is that the complexity of
modern civilization creates new problems with which we cannot
hope to deal effectively except by central planning. This argument
is based upon a complete misapprehension of the working of
competition. The very complexity of modern conditions makes
competition the only method by which a coordination of affairs
can be adequately achieved.
There would be no diffi culty about effi cient control or
planning were conditions so simple that a single person or board
could effectively survey all the facts. But as the factors which have
to be taken into account become numerous and complex, no one
centre can keep track of them. The constantly changing conditions
of demand and supply of different commodities can never be fully
known or quickly enough disseminated by any one centre.
Under competition – and under no other economic order –
the price system automatically records all the relevant data. Entrepreneurs,
by watching the movement of comparatively few prices,
as an engineer watches a few dials, can adjust their activities to
those of their fellows.
Compared with this method of solving the economic problem
– by decentralization plus automatic coordination through
the price system – the method of central direction is incredibly
clumsy, primitive, and limited in scope. It is no exaggeration to say
that if we had had to rely on central planning for the growth of our
industrial system, it would never have reached the degree of differentiation
and fl exibility it has attained. Modern civilization has
t h e roa d to serfdom
59
The difference between the two kinds of rule is important. It
is the same as that between providing signposts and commanding
people which road to take.
Moreover, under central planning the government cannot be
impartial. The state ceases to be a piece of utilitarian machinery
intended to help individuals in the fullest development of their individual
personality and becomes an institution which deliberately
discriminates between particular needs of different people, and
allows one man to do what another must be prevented from doing.
It must lay down by a legal rule how well off particular people shall
be and what different people are to be allowed to have.
The Rule of Law, the absence of legal privileges of particular
people designated by authority, is what safeguards that equality
before the law which is the opposite of arbitrary government. It
is signifi cant that socialists (and Nazis) have always protested
against ‘merely’ formal justice, that they have objected to law
which had no views on how well off particular people ought to be,
that they have demanded a ‘socialization of the law’ and attacked
the independence of judges.
In a planned society the law must legalize what to all intents
and purposes remains arbitrary action. If the law says that such
a board or authority may do what it pleases, anything that board
or authority does is legal – but its actions are certainly not subject
to the Rule of Law. By giving the government unlimited powers
the most arbitrary rule can be made legal; and in this way a democracy
may set up the most complete despotism imaginable.
The Rule of Law was consciously evolved only during the
liberal age and is one of its greatest achievements. It is the legal
embodiment of freedom. As Immanuel Kant put it, ‘Man is free if
he needs obey no person but solely the laws.’
t h e roa d to serfdom
58
opment. In the United States a highly protectionist policy aided
the growth of monopolies. In Germany the growth of cartels has
since 1878 been systematically fostered by deliberate policy. It was
here that, with the help of the state, the fi rst great experiment in
‘scientifi c planning’ and ‘conscious organization of industry’ led
to the creation of giant monopolies. The suppression of competition
was a matter of deliberate policy in Germany, undertaken in
the service of an ideal which we now call planning.
Great danger lies in the policies of two powerful groups, organized
capital and organized labour, which support the monopolistic
organization of industry. The recent growth of monopoly is
largely the result of a deliberate collaboration of organized capital
and organized labour where the privileged groups of labour
share in the monopoly profi ts at the expense of the community
and particularly at the expense of those employed in the less well
organized industries. However, there is no reason to believe that
this movement is inevitable.
The movement toward planning is the result of deliberate
action. No external necessities force us to it.
Can planning free us from care?
Most planners who have seriously considered the practical aspects
of their task have little doubt that a directed economy must be run
on dictatorial lines, that the complex system of interrelated activities
must be directed by staffs of experts, with ultimate power in
the hands of a commander-in-chief whose actions must not be
fettered by democratic procedure. The consolation our planners
offer us is that this authoritarian direction will apply ‘only’ to
economic matters. This assurance is usually accompanied by the
t h e roa d to serfdom
61
been possible precisely because it did not have to be consciously
created. The division of labour has gone far beyond what could
have been planned. Any further growth in economic complexity,
far from making central direction more necessary, makes it more
important than ever that we should use the technique of competition
and not depend on conscious control.
It is also argued that technological changes have made competition
impossible in a constantly increasing number of fi elds and
that our only choice is between control of production by private
monopolies and direction by the government. The growth of
monopoly, however, seems not so much a necessary consequence
of the advance of technology as the result of the policies pursued
in most countries.
The most comprehensive study of this situation is that by
the Temporary National Economic Committee, which certainly
cannot be accused of an unduly liberal bias. The committee
concludes:
The superior effi ciency of large establishments has not
been demonstrated; the advantages that are supposed to
destroy competition have failed to manifest themselves in
many fi elds . . . the conclusion that the advantage of largescale
production must lead inevitably to the abolition of
competition cannot be accepted . . . It should be noted,
moreover, that monopoly is frequently attained through
collusive agreement and promoted by public policies.
When these agreements are invalidated and these policies
reversed, competitive conditions can be restored.
Anyone who has observed how aspiring monopolists regularly
seek the assistance of the state to make their control effective can
have little doubt that there is nothing inevitable about this develt
h e roa d to serfdom
60
allowed to choose, and that whoever fi xed the reward would determine
not only its size but the way in which it should be enjoyed.
The so-called economic freedom which the planners promise us
means precisely that we are to be relieved of the necessity of solving
our own economic problems and that the bitter choices which this
often involves are to be made for us. Since under modern conditions
we are for almost everything dependent on means which our
fellow men provide, economic planning would involve direction of
almost the whole of our life. There is hardly an aspect of it, from
our primary needs to our relations with our family and friends,
from the nature of our work to the use of our leisure, over which
the planner would not exercise his ‘conscious control’.
The power of the planner over our private lives would be
hardly less effective if the consumer were nominally free to spend
his income as he pleased, for the authority would control production.
Our freedom of choice in a competitive society rests on the
fact that, if one person refuses to satisfy our wishes, we can turn to
another. But if we face a monopolist we are at his mercy. And an
authority directing the whole economic system would be the most
powerful monopolist imaginable.
It would have complete power to decide what we are to be given
and on what terms. It would not only decide what commodities
and services are to be available and in what quantities; it would be
able to direct their distribution between districts and groups and
could, if it wished, discriminate between persons to any degree
it liked. Not our own view, but somebody else’s view of what we
ought to like or dislike, would determine what we should get.
The will of the authority would shape and ‘guide’ our daily
lives even more in our position as producers. For most of us the
t h e roa d to serfdom
63
suggestion that, by giving up freedom in the less important aspects
of our lives, we shall obtain freedom in the pursuit of higher values.
On this ground people who abhor the idea of a political dictatorship
often clamour for a dictator in the economic fi eld.
The arguments used appeal to our best instincts. If planning
really did free us from less important cares and so made it easier
to render our existence one of plain living and high thinking, who
would wish to belittle such an ideal?
Unfortunately, purely economic ends cannot be separated
from the other ends of life. What is misleadingly called the
‘economic motive’ means merely the desire for general opportunity.
If we strive for money, it is because money offers us the
widest choice in enjoying the fruits of our efforts – once earned,
we are free to spend the money as we wish.
Because it is through the limitation of our money incomes that
we feel the restrictions which our relative poverty still imposes
on us, many have come to hate money as the symbol of these
restrictions. Actually, money is one of the greatest instruments
of freedom ever invented by man. It is money which in existing
society opens an astounding range of choice to the poor man – a
range greater than that which not many generations ago was open
to the wealthy.
We shall better understand the signifi cance of the service of
money if we consider what it would really mean if, as so many
socialists characteristically propose, the ‘pecuniary motive’ were
largely displaced by ‘non-economic incentives’. If all rewards,
instead of being offered in money, were offered in the form of
public distinctions, or privileges, positions of power over other
men, better housing or food, opportunities for travel or education,
this would merely mean that the recipient would no longer be
t h e roa d to serfdom
62
others. People just wish that the choice should not be necessary
at all. And they are only too ready to believe that the choice is
not really necessary, that it is imposed upon them merely by the
particular economic system under which we live. What they resent
is, in truth, that there is an economic problem.
The wishful delusion that there is really no longer an economic
problem has been furthered by the claim that a planned economy
would produce a substantially larger output than the competitive
system. This claim, however, is being progressively abandoned by
most students of the problem. Even a good many economists with
socialist views are now content to hope that a planned society
will equal the effi ciency of a competitive system. They advocate
planning because it will enable us to secure a more equitable
distribution of wealth. And it is indisputable that, if we want
consciously to decide who is to have what, we must plan the whole
economic system.
But the question remains whether the price we should have to
pay for the realization of somebody’s ideal of justice is not bound
to be more discontent and more oppression than was ever caused
by the much abused free play of economic forces.
For when a government undertakes to distribute the wealth,
by what principles will it or ought it to be guided? Is there a
defi nite answer to the innumerable questions of relative merits
that will arise?
Only one general principle, one simple rule, would provide
such an answer: absolute equality of all individuals. If this were
the goal, it would at least give the vague idea of distributive justice
clear meaning. But people in general do not regard mechanical
equality of this kind as desirable, and socialism promises not
complete equality but ‘greater equality’.
t h e roa d to serfdom
65
time we spend at our work is a large part of our whole lives, and
our job usually determines the place where and the people among
whom we live. Hence some freedom in choosing our work is
probably even more important for our happiness than freedom to
spend our income during our hours of leisure.
Even in the best of worlds this freedom will be limited. Few
people ever have an abundance of choice of occupation. But what
matters is that we have some choice, that we are not absolutely
tied to a job which has been chosen for us, and that if one position
becomes intolerable, or if we set our heart on another, there is
always a way for the able, at some sacrifi ce, to achieve his goal.
Nothing makes conditions more unbearable than the knowledge
that no effort of ours can change them. It may be bad to be just a
cog in a machine but it is infi nitely worse if we can no longer leave
it, if we are tied to our place and to the superiors who have been
chosen for us.
In our present world there is much that could be done to
improve our opportunities of choice. But ‘planning’ would surely
go in the opposite direction. Planning must control the entry
into the different trades and occupations, or the terms of remuneration,
or both. In almost all known instances of planning, the
establishment of such controls and restrictions was among the
fi rst measures taken.
In a competitive society most things can be had at a price. It
is often a cruelly high price. We must sacrifi ce one thing to attain
another. The alternative, however, is not freedom of choice, but
orders and prohibitions which must be obeyed.
That people should wish to be relieved of the bitter choice
which hard facts often impose on them is not surprising. But few
want to be relieved through having the choice made for them by
t h e roa d to serfdom
64
general level of wealth ours has, the fi rst kind of security should
not be guaranteed to all without endangering general freedom;
that is: some minimum of food, shelter and clothing, suffi cient to
preserve health. Nor is there any reason why the state should not
help to organize a comprehensive system of social insurance in
providing for those common hazards of life against which few can
make adequate provision.
It is planning for security of the second kind which has such
an insidious effect on liberty. It is planning designed to protect
individuals or groups against diminutions of their incomes.
If, as has become increasingly true, the members of each trade
in which conditions improve are allowed to exclude others in
order to secure to themselves the full gain in the form of higher
wages or profi ts, those in the trades where demand has fallen off
have nowhere to go, and every change results in large unemployment.
There can be little doubt that it is largely a consequence of
the striving for security by these means in the last decades that
unemployment and thus insecurity have so much increased.
The utter hopelessness of the position of those who, in a
society which has thus grown rigid, are left outside the range of
sheltered occupation can be appreciated only by those who have
experienced it. There has never been a more cruel exploitation of
one class by another than that of the less fortunate members of a
group of producers by the well-established. This has been made
possible by the ‘regulation’ of competition. Few catchwords have
done so much harm as the ideal of a ‘stabilization’ of particular
prices or wages, which, while securing the income of some, makes
the position of the rest more and more precarious.
In England and America special privileges, especially in the
form of the ‘regulation’ of competition, the ‘stabilization’ of
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67
This formula answers practically no questions. It does not
free us from the necessity of deciding in every particular instance
between the merits of particular individuals or groups, and it gives
no help in that decision. All it tells us in effect is to take from the
rich as much as we can. When it comes to the distribution of the
spoils the problem is the same as if the formula of ‘greater equality’
had never been conceived.
It is often said that political freedom is meaningless without
economic freedom. This is true enough, but in a sense almost
opposite from that in which the phrase is used by our planners.
The economic freedom which is the prerequisite of any other
freedom cannot be the freedom from economic care which the
socialists promise us and which can be obtained only by relieving
us of the power of choice. It must be that freedom of economic
activity which, together with the right of choice, carries also the
risk and responsibility of that right.
Two kinds of security
Like the spurious ‘economic freedom’, and with more justice,
economic security is often represented as an indispensable condition
of real liberty. In a sense this is both true and important. Independence
of mind or strength of character is rarely found among
those who cannot be confi dent that they will make their way by
their own effort.
But there are two kinds of security: the certainty of a given
minimum of sustenance for all and the security of a given standard
of life, of the relative position which one person or group enjoys
compared with others.
There is no reason why, in a society which has reached the
t h e roa d to serfdom
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satisfy the new demands, we shall not unwittingly destroy values
which we still rate higher.
The confl ict with which we have to deal is a fundamental one
between two irreconcilable types of social organization, which
have often been described as the commercial and the military.
In either both choice and risk rest with the individual or he is
relieved of both. In the army, work and worker alike are allotted
by authority, and this is the only system in which the individual
can be conceded full economic security. This security is, however,
inseparable from the restrictions on liberty and the hierarchical
order of military life – it is the security of the barracks.
In a society used to freedom it is unlikely that many people
would be ready deliberately to purchase security at this price.
But the policies which are followed now are nevertheless rapidly
creating conditions in which the striving for security tends to
become stronger than the love of freedom.
If we are not to destroy individual freedom, competition must
be left to function unobstructed. Let a uniform minimum be
secured to everybody by all means; but let us admit at the same
time that all claims for a privileged security of particular classes
must lapse, that all excuses disappear for allowing particular
groups to exclude newcomers from sharing their relative prosperity
in order to maintain a special standard of their own.
There can be no question that adequate security against
severe privation will have to be one of our main goals of policy.
But nothing is more fatal than the present fashion of intellectual
leaders of extolling security at the expense of freedom. It is essential
that we should re-learn frankly to face the fact that freedom
can be had only at a price and that as individuals we must be
prepared to make severe material sacrifi ces to preserve it.
t h e roa d to serfdom
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particular prices and wages, have assumed increasing importance.
With every grant of such security to one group the insecurity of
the rest necessarily increases. If you guarantee to some a fi xed part
of a variable cake, the share left to the rest is bound to fl uctuate
proportionally more than the size of the whole. And the essential
element of security which the competitive system offers, the great
variety of opportunities, is more and more reduced.
The general endeavour to achieve security by restrictive
measures, supported by the state, has in the course of time
produced a progressive transformation of society – a transformation
in which, as in so many other ways, Germany has led and the
other countries have followed. This development has been hastened
by another effect of socialist teaching, the deliberate disparagement
of all activities involving economic risk and the moral opprobrium
cast on the gains which make risks worth taking but which only few
can win.
We cannot blame our young men when they prefer the safe,
salaried position to the risk of enterprise after they have heard
from their earliest youth the former described as the superior,
more unselfi sh and disinterested occupation. The younger generation
of today has grown up in a world in which, in school and
press, the spirit of commercial enterprise has been represented
as disreputable and the making of profi t as immoral, where to
employ 100 people is represented as exploitation but to command
the same number as honourable.
Older people may regard this as exaggeration, but the daily
experience of the university teacher leaves little doubt that, as a
result of anti-capitalist propaganda, values have already altered
far in advance of the change in institutions which has so far taken
place. The question is whether, by changing our institutions to
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Originally published in Look magazine
Reproduced from a booklet published by
General Motors, Detroit, in the ‘Thought Starter’ series (no. 118)
We must regain the conviction on which liberty in the Anglo-
Saxon countries has been based and which Benjamin Franklin
expressed in a phrase applicable to us as individuals no less than
as nations: ‘Those who would give up essential liberty to purchase
a little temporary safety deserve neither liberty nor safety.’
Toward a better world
To build a better world, we must have the courage to make a new
start. We must clear away the obstacles with which human folly
has recently encumbered our path and release the creative energy
of individuals. We must create conditions favourable to progress
rather than ‘planning progress’.
It is not those who cry for more ‘planning’ who show the
necessary courage, nor those who preach a ‘New Order’, which
is no more than a continuation of the tendencies of the past 40
years, and who can think of nothing better than to imitate Hitler.
It is, indeed, those who cry loudest for a planned economy who are
most completely under the sway of the ideas which have created
this war and most of the evils from which we suffer.
The guiding principle in any attempt to create a world of free
men must be this: a policy of freedom for the individual is the only
truly progressive policy.
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The Intellectuals and Socialism
A note on the text
‘The Intellectuals and Socialism’ was fi rst published in the
University of Chicago Law Review, Vol. 16, No. 3, Spring 1949. It
was reprinted in F. A. Hayek, Studies in Philosophy, Politics and
Economics, Routledge and Kegan Paul, London, 1967. It was
published as a booklet in the Studies in Social Theory Series by
the Institute of Humane Studies, California, 1971. The text of this
edition is taken from Studies in Philosophy, Politics and Economics.
The copyright of ‘The Intellectuals and Socialism’ remains with
the University of Chicago Law Review, and the essay is republished
here by kind permission. This essay was also previously
published by the IEA in the Rediscovered Riches series.
93
In the late Professor F. A. Hayek’s 1949 essay, ‘The Intellectuals
and Socialism’, the author’s fi nal paragraph warns: ‘Unless we can
make the philosophic foundations of a free society once more a
living intellectual issue, and its implementation a task which challenges
the ingenuity and imagination of our liveliest minds, the
prospects of freedom are indeed dark. But if we can regain that
belief in the power of ideas which was the mark of liberalism at its
best, the battle is not lost. The intellectual revival of liberalism is
already under way in many parts of the world. Will it be in time?’
Fortunately, Professor Hayek’s warning was heeded, just in
time. His colleagues in the Mont Pèlerin Society, his students, and
his admirers from around the world took his message to heart,
and they have spent the decades since the publication of this essay
honing their arguments for liberty, and transmitting these ideas
through institutions, publications and conferences with a success
undreamt of in 1949.
For many of us, Hayek’s brief essay was a call to action. In it, he
explained the process by which ideas are developed and become
widely accepted, and he noted why our own classical liberal ideas
may not be as widely held, or as fashionable, as they deserve to be.
For too long we had underestimated the power of the ‘intellectual
class’ – the ‘professional second-hand dealers in ideas’, as Hayek
refers to them – to shape the climate of public opinion. As Hayek
FOREWORD
the intellecua l s a n d s o c i a l i s m
94
foreword
95
pointed out, the parties of the Left directed most of their energies,
either by design or circumstance, toward gaining the support
of this intellectual elite – the journalists, teachers, ministers,
lecturers, publicists, writers, and artists who were masters of the
technique of conveying ideas. At the time of this essay Hayek said
that most of us learn little about events or ideas except through
this class (and with the growth of television, it’s probably even
less). The intellectuals have become gatekeepers for the information,
views, and opinions that ultimately do reach us. Conservatives,
by contrast, had concentrated on reaching and persuading
individual voters.
For many of us, this essay was a challenge to build up our
own class of intellectuals made up of those who loved liberty.
We trained, hired, networked, and supported academics, policy
analysts, journalists, radio talk show hosts, and even political
leaders who would shape public opinion and infl uence the
politics of tomorrow. And in many areas we have succeeded in
changing the climate of public opinion and changing the world.
Commun ism has failed, the Berlin Wall has been torn down, and
even left-of-centre politicians like [former] President Clinton
and Prime Minister Blair are embracing the rhetoric of our classical
liberal solutions when talking of some of our modern social
problems. I believe the irony would not be lost on Professor
Hayek!
Clearly much remains to be done before we can enjoy a truly
free society. And for guidance we should once again turn to
Hayek. As he points out, much of the success socialism gained
up until 1949 was not by engaging in a battle of confl icting
ideals, but by contrasting the existing state of affairs with that
one ideal of a possible future society which the socialists alone
held up before the public. ‘Very few of the other programmes
which offered themselves provided genuine alternatives.’ (p. 123.)
Compromises were thus made somewhere between the socialist
ideal and the existing state of affairs. The only questions for
socialists were how fast and how far to proceed. Conservatives
have learned this lesson: it is not enough to stop bad policies, we
have to offer genuine alternatives.
Since the original publication of ‘The Intellectuals and
Socialism’ we have developed the philosophical foundations of a
free society, thanks to Hayek, our friends at the IEA, and others.
And we have built a class of intellectuals to translate these philosophical
ideas to the public. However, we have not held up before
the public our own vision of a future society built on liberty. And
this is the task facing us as we approach the new millennium. As
Hayek said, the task of constructing a free society can be exciting
and fascinating. If we are to succeed, we must make the building
of a free society once more an intellectual adventure and a deed of
courage.
As an alumnus of the Institute of Economic Affairs, I particularly
thank our good friends at the IEA for republishing this very
special essay, and most importantly for the many courageous
intellectual adventures they have undertaken.
e d w i n j . f e u l n e r j r
96 97
i n t roduction
In April 1945 Reader’s Digest published the condensed version
of Friedrich Hayek’s classic work The Road to Serfdom. For the fi rst
and still the only time in the history of the Digest, the condensed
book was carried at the front of the magazine rather than the back.
Among the many who read the condensed book was Antony
Fisher. In his very early thirties, this former Battle of Britain
pilot turned stockbroker turned farmer went to see Hayek at
the London School of Economics to discuss his concern over the
advance of socialism and collectivism in Britain. Fisher feared that
the country for whom so many, including his father and brother,
had died in two world wars in order that it should remain free was,
in fact, becoming less and less free. He saw liberty threatened by
the ever-growing power and scope of the state. The purpose of his
visit to Hayek, the great architect of the revival of classical liberal
ideas, was to ask what could be done about it.
My central question was what, if anything, could he advise
me to do to help get discussion and policy on the right lines
. . . Hayek fi rst warned me against wasting time – as I was
then tempted – by taking up a political career. He explained
his view that the decisive infl uence in the battle of ideas and
policy was wielded by intellectuals whom he characterised
as the ‘second-hand dealers in ideas’. It was the dominant
intellectuals from the Fabians onwards who had tilted
the political debate in favour of growing government
INTRODUCTION
Hayek and the Second-hand Dealers in Ideas
intervention with all that followed. If I shared the view that
better ideas were not getting a fair hearing, his counsel was
that I should join with others in forming a scholarly research
organisation to supply intellectuals in universities, schools,
journalism and broadcasting with authoritative studies
of the economic theory of markets and its application to
practical affairs.1
Fisher went on to make his fortune by introducing factory
farming of chickens on the American model to Britain. His
company, Buxted Chickens, changed the diet of his fellow countrymen,
and made him rich enough to carry out Hayek’s advice.
He set up the Institute of Economic Affairs in 1955 with the view
that:
[T]hose carrying on intellectual work must have a
considerable impact through newspapers, radio, television
and so on, on the thinking of the average individual.
Socialism was spread in this way and it is time we started to
reverse the process.2
He thus set himself exactly the task which Hayek had recommended
to him in 1945.
Soon after that meeting with Fisher, Hayek expanded on his theory
of the infl uence of intellectuals in an essay entitled ‘The Intellectuals
and Socialism’, fi rst published in the Chicago Law Review in
1949 and now republished by the Institute of Economic Affairs.
1 A. Fisher, Must History Repeat Itself?, Churchill Press, 1974, p. 103, quoted in R.
Cockett, Thinking the Unthinkable, HarperCollins, London, 1995, pp. 123–4.
2 Letter from Antony Fisher to Oliver Smedley, 22 May 1956, quoted in R. Cockett,
op. cit., p. 131. Emphasis in original.
the intellecua l s a n d s o c i a l i s m
98 99
i n t roduction
According to Hayek, the intellectual is neither an original thinker
nor an expert. Indeed he need not even be intelligent. What he
does possess is:
a) the ability to speak/write on a wide range of subjects; and
b) a way of becoming familiar with new ideas earlier than his
audience.
Let me attempt to summarise Hayek’s insights:
1. Pro-market ideas had failed to remain relevant and inspiring,
thus opening the door to anti-market forces.
2. People’s knowledge of history plays a much greater role in the
development of their political philosophy than we normally
think.3
3. Practical men and women concerned with the minutiae of
today’s events tend to lose sight of long-term considerations.
4. Be alert to special interests, especially those that, while
claiming to be pro-free enterprise in general, always want to
make exceptions in their own areas of expertise.
5. The outcome of today’s politics is already set, so look for
leverage for tomorrow as a scholar or intellectual.
6. The intellectual is the gatekeeper of ideas.
7. The best pro-market people become businessmen, engineers,
doctors and so on; the best anti-market people become
intellectuals and scholars.
8. Be Utopian and believe in the power of ideas.
Hayek’s primary example is the period 1850 to 1950, during
which socialism was nowhere, at fi rst, a working-class movement.
There was always a long-term effort by the intellectuals before
the working classes accepted socialism. Indeed all countries that
have turned to socialism experienced an earlier phase in which for
many years socialist ideas governed the thinking of more active
intellectuals. Once you reach this phase, experience suggests, it
is just a matter of time before the views of today’s intellectuals
become tomorrow’s politics.
‘The Intellectuals and Socialism’ was published in 1949, but,
apart from one reference in one sentence, there is nothing to say it
could not have been written forty years later, just before Hayek’s
death. It might have been written forty years earlier but for the
fact that, as a young man, he felt the over-generous instincts of
socialism. When Hayek penned his thoughts, socialism seemed
triumphant across the world. Anybody of enlightened sensibility
regarded themselves as of ‘The Left’. To be of ‘The Right’ was to be
morally deformed, foolish, or both.
In Alan Bennett’s 1968 play Forty Years On the headmaster of
Albion House, a minor public school which represents Britain,
asks: ‘Why is it always the intelligent people who are socialists?’4
Hayek’s answer, which he expressed in his last major work, The
Fatal Conceit, was that ‘intelligent people will tend to overvalue
intelligence’. They think that everything worth knowing can be
discovered by processes of intellectual examination and ‘fi nd it
hard to believe that there can exist any useful knowledge that did
not originate in deliberate experimentation’. They consequently
3 As Leonard P. Liggio, executive vice president of the Atlas Economic Research
Foundation, often says, more people learn their economics from history than
from economics.
4 A. Bennett, Forty Years On, fi rst performance 31 October 1968; Faber and Faber,
London, 1969, p. 58.
the intellecua l s a n d s o c i a l i s m
100 101
i n t roduction
neglect the ‘traditional rules’, the ‘second endowment’ of ‘cultural
evolution’ which, for Hayek, included morals, especially ‘our institutions
of property, freedom and justice’. They think that any
imperfection can be corrected by ‘rational coordination’ and this
leads them ‘to be favourably disposed to the central economic
planning and control that lie at the heart of socialism’. Thus,
whether or not they call themselves socialists, ‘the higher we
climb up the ladder of intelligence . . . the more likely we are to
encounter socialist convictions’.5
Only when you start to list all the different groups of intellectuals
do you realise how many there are, how their role has grown in
modern times, and how dependent we have become on them. The
more obvious ones are those who are professionals at conveying
a message but are amateurs when it comes to substance. They
include the ‘journalists, teachers, ministers, lecturers, publicists,
radio commentators, writers of fi ction, cartoonists, and artists’.
However we should also note the role of ‘professional men and
technicians’ (p. 107) who are listened to by others with respect on
topics outside their competence because of their standing. The
intellectuals decide what we hear, in what form we are to hear it
and from what angle it is to be presented. They decide who will be
heard and who will not be heard. The supremacy and pervasiveness
of television as the controlling medium of modern culture
makes that even more true of our own day than it was in the
1940s.
There is an alarming sentence in this essay: ‘[I]n most parts
of the Western World even the most determined opponents of
socialism derive from socialist sources their knowledge on most
subjects on which they have no fi rst-hand information’ (p. 112).
Division of knowledge is a part of the division of labour. Knowledge,
and its manipulation, are the bulk of much labour now. A
majority earns its living in services of myriad sorts rather than in
manufacturing or agriculture.
A liberal, or as Hayek would always say, a Whig, cannot
disagree with a socialist analysis in a fi eld in which he has no
knowledge. The disquieting theme of Hayek’s argument is how the
fragmentation of knowledge is a tactical boon to socialists. Experts
in particular fi elds often gain ‘rents’ from state intervention and,
while overtly free-market in their outlook elsewhere, are always
quick to explain why the market does not work in their area.
This was one of the reasons for establishing the IEA and its
100-plus sister bodies around the world. Hayek also regarded the
creation of the Mont Pèlerin Society, which fi rst met in 1947, as an
opportunity for minds engaged in the fi ght against socialism to
exchange ideas – meaning, by socialism, all those ideas devoted to
empowering the state. The threat posed by the forces of coercion
to those of voluntary association or spontaneous action is what
concerned him.
The struggle has become more diffi cult as policy makers have
become less and less willing to identify themselves explicitly as
socialists. A review of a book on socialism which appeared in 1885
began:
Socialism is the hobby of the day. Platform and study
resound with the word, and street and debating society
inscribe it on their banners.6
5 F. Hayek, The Fatal Conceit: The Errors of Socialism, in W. W. Bartley (ed.), The Collected
Works of Friedrich August Hayek, Routledge, London, Vol. 1, 1988, pp. 52–4.
6 Review of Contemporary Socialism by John Rae, Charity Organisation Review, Charity
Organisation Society, London, October 1885.
the intellecua l s a n d s o c i a l i s m
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i n t roduction
How unlike the home life of our own New Labour! Socialism
has become the ‘s’ word, and was not mentioned in the Labour
Party’s 1997 election manifesto.7
Socialism survives, however, by transmuting itself into new
forms. State-run enterprises are now frowned upon, but the everexpanding
volume of regulation – fi nancial, environmental, health
and safety – serves to empower the state by other means.
Part of Hayek’s charm is the pull of his sheer geniality. He is
generous and mannerly in acknowledging that most socialists
have benign intentions. They are blind to the real fl aws of their
recipes. Typically, Hayek ends with a point in their favour: ‘[I]t
was their courage to be Utopian which gained them the support
of the intellectuals and therefore an infl uence on public opinion’
(p. 129). Those who concern themselves exclusively with what
seems practicable are marginalised by the greater infl uence of
prevailing opinion.
I commend to you Hayek’s urge not to seek compromises. We
can leave that to the politicians. ‘Free trade and freedom of opportunity
are ideals which still may arouse the imaginations of large
numbers, but a mere “reasonable freedom of trade” or a mere
“relaxation of controls” is neither intellectually respectable nor
likely to inspire any enthusiasm’ (p. 129).
Most of the readers of this paper will be Hayek’s ‘second-hand
dealers in ideas’. Conceit makes us all prone to believe we are
original thinkers, but Hayek explains that we are mostly transmitters
of ideas borrowed from earlier minds (hence second-hand, in
a non-pejorative sense). Those scholars who really are the founts of
new ideas are far more rare than we all suppose. However, Hayek
argues that we, and the world, are governed by ideas and that we
can only expand our political and policy horizons by deploying
them.
He was supported in this view – and it was probably the only
view they shared – by John Maynard Keynes. In 1936 Keynes had
concluded his most famous book, The General Theory of Employment,
Interest and Money, with these ringing words:
. . . the ideas of economists and political philosophers, both
when they are right and when they are wrong, are more
powerful than is commonly understood. Indeed the world is
ruled by little else. Practical men, who believe themselves to
be quite exempt from any intellectual infl uences, are usually
the slaves of some defunct economist . . . Soon or late, it is
ideas, not vested interests, which are dangerous for good or
evil.8
Of course, this was true of no one more than of Keynes himself,
whose followers were wreaking havoc with the world’s economies
long after he had become defunct. But it was also true of Hayek.
It was Hayek’s great good fortune to live long enough to see his
own ideas enter the mainstream of public policy debate. They
were not always attributed to him: they were described as Thatcherism,
or Adam-Smith liberalism, or neo-conservatism, but he
was responsible for their re-emergence, whether credited or not.
We received a striking demonstration of this at the IEA in 1996
when we invited Donald Brash, the Governor of the Reserve Bank
7 New Labour: Because Britain Deserves Better, The Labour Party, London, 1997. On
the contrary, the manifesto complained that: ‘Our system of government is centralised,
ineffi cient and bureaucratic.’
8 J. M. Keynes, The General Theory of Employment, Interest and Money, Macmillan,
London, p. 383.
the intellecua l s a n d s o c i a l i s m
104 105
of New Zealand, to give the prestigious Annual Hayek Memorial
Lecture on the subject of ‘New Zealand’s Remarkable Reforms’.
He admitted that, although ‘the New Zealand reforms have a
distinctly Hayekian fl avour’, the architects of them were scarcely
aware of Hayek at all, and Brash himself had never read a word of
Hayek before being asked to give the lecture.9
The IEA can claim some victories in the increasing awareness
of classical liberal ideas and ideals. It is hard to measure our infl uence,
yet, if we awaken some young scholar to the possibility that
the paradigms or conventions of a discipline may be fl awed, we
can change the life of that mind for ever. If we convince a young
journalist he can do more good, and have more fun, by criticising
the remnants of our socialist inheritance, we can change that
life. If we persuade a young politician he can harass the forces
of inertia by tackling privilege and bureaucracy, we change the
course of that life too. The IEA continues in its mission to move
around the furniture in the minds of intellectuals. That includes
you, probably.
j o h n b l u n d e l l
9 D. T. Brash, New Zealand’s Remarkable Reforms, Occasional Paper 100, Institute of
Economic Affairs, London, 1996, p. 17.
I
In all democratic countries, in the United States even more than
elsewhere, a strong belief prevails that the infl uence of the intellectuals
on politics is negligible. This is no doubt true of the power of
intellectuals to make their peculiar opinions of the moment infl uence
decisions, of the extent to which they can sway the popular
vote on questions on which they differ from the current views of
the masses. Yet over somewhat longer periods they have probably
never exercised so great an infl uence as they do today in those
countries. This power they wield by shaping public opinion.
In the light of recent history it is somewhat curious that this
decisive power of the professional second-hand dealers in ideas
should not yet be more generally recognised. The political development
of the Western world during the last hundred years
furnishes the clearest demonstration. Socialism has never and
nowhere been at fi rst a working-class movement. It is by no means
an obvious remedy for the obvious evil which the interests of that
class will necessarily demand. It is a construction of theorists,
deriving from certain tendencies of abstract thought with which
for a long time only the intellectuals were familiar; and it required
long efforts by the intellectuals before the working classes could
be persuaded to adopt it as their programme.
THE INTELLECTUALS AND SOCIALISM
the intellecua l s a n d s o c i a l i s m
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t h e i n t e l l e c t ua l s a n d s o c i a l i s m
In every country that has moved toward socialism, the phase of
the development in which socialism becomes a determining infl uence
on politics has been preceded for many years by a period during
which socialist ideals governed the thinking of the more active intellectuals.
In Germany this stage had been reached towards the end
of the last century; in England and France, about the time of World
War I. To the casual observer it would seem as if the United States
had reached this phase after World War II and that the attraction
of a planned and directed economic system is now as strong among
the American intellectuals as it ever was among their German or
English fellows. Experience suggests that, once this phase has been
reached, it is merely a question of time until the views now held by
the intellectuals become the governing force of politics.
The character of the process by which the views of the intellectuals
infl uence the politics of tomorrow is therefore of much
more than academic interest. Whether we merely wish to foresee
or attempt to infl uence the course of events, it is a factor of much
greater importance than is generally understood. What to the
contemporary observer appears as the battle of confl icting interests
has indeed often been decided long before in a clash of ideas
confi ned to narrow circles. Paradoxically enough, however, in
general the parties of the Left have done most to spread the belief
that it was the numerical strength of the opposing material interests
which decided political issues, whereas in practice these same
parties have regularly and successfully acted as if they understood
the key position of the intellectuals. Whether by design or driven
by the force of circumstances, they have always directed their
main effort towards gaining the support of this ‘elite’, while the
more conservative groups have acted, as regularly but unsuccessfully,
on a more naïve view of mass democracy and have usually
vainly tried directly to reach and to persuade the individual voter.
II
The term ‘intellectuals’, however, does not at once convey a true
picture of the large class to which we refer, and the fact that we
have no better name by which to describe what we have called the
second-hand dealers in ideas is not the least of the reasons why
their power is not better understood. Even persons who use the
word ‘intellectual’ mainly as a term of abuse are still inclined to
withhold it from many who undoubtedly perform that characteristic
function. This is neither that of the original thinker nor that
of the scholar or expert in a particular fi eld of thought. The typical
intellectual need be neither: he need not possess special knowledge
of anything in particular, nor need he even be particularly
intelligent, to perform his role as intermediary in the spreading of
ideas. What qualifi es him for his job is the wide range of subjects
on which he can readily talk and write, and a position or habits
through which he becomes acquainted with new ideas sooner
than those to whom he addresses himself.
Until one begins to list all the professions and activities which
belong to this class, it is diffi cult to realise how numerous it is,
how the scope for its activities constantly increases in modern
society, and how dependent on it we all have become. The class
does not consist only of journalists, teachers, ministers, lecturers,
publicists, radio commentators, writers of fi ction, cartoonists, and
artists – all of whom may be masters of the technique of conveying
ideas but are usually amateurs so far as the substance of what they
convey is concerned. The class also includes many professional
men and technicians, such as scientists and doctors, who through
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their habitual intercourse with the printed word become carriers of
new ideas outside their own fi elds and who, because of their expert
knowledge of their own subjects, are listened to with respect on
most others. There is little that the ordinary man of today learns
about events or ideas except through the medium of this class; and
outside our special fi elds of work we are in this respect almost all
ordinary men, dependent for our information and instruction on
those who make it their job to keep abreast of opinion. It is the
intellectuals in this sense who decide what views and opinions
are to reach us, which facts are important enough to be told to us,
and in what form and from what angle they are to be presented.
Whether we shall ever learn of the results of the work of the expert
and the original thinker depends mainly on their decision.
The layman, perhaps, is not fully aware to what extent even
the popular reputations of scientists and scholars are made by
that class and are inevitably affected by its views on subjects which
have little to do with the merits of the real achievements. And
it is specially signifi cant for our problem that every scholar can
probably name several instances from his fi eld of men who have
undeservedly achieved a popular reputation as great scientists
solely because they hold what the intellectuals regard as ‘progressive’
political views; but I have yet to come across a single instance
where such a scientifi c pseudo-reputation has been bestowed
for political reason on a scholar of more conservative leanings.
This creation of reputations by the intellectuals is particularly
import ant in the fi elds where the results of expert studies are not
used by other specialists but depend on the political decision of
the public at large. There is indeed scarcely a better illustration of
this than the attitude which professional economists have taken to
the growth of such doctrines as socialism or protectionism. There
was probably at no time a majority of economists, who were recognised
as such by their peers, favourable to socialism (or, for that
matter, to protection). In all probability it is even true to say that
no other similar group of students contains so high a proportion
of its members decidedly opposed to socialism (or protection).
This is the more signifi cant as in recent times it is as likely as not
that it was an early interest in socialist schemes for reform which
led a man to choose economics for his profession. Yet it is not the
predominant views of the experts but the views of a minority,
mostly of rather doubtful standing in their profession, which are
taken up and spread by the intellectuals.
The all-pervasive infl uence of the intellectuals in contempor ary
society is still further strengthened by the growing importance of
‘organisation’. It is a common but probably mistaken belief that
the increase of organisation increases the infl uence of the expert
or specialist. This may be true of the expert administrator and
organiser, if there are such people, but hardly of the expert in any
particular fi eld of knowledge. It is rather the person whose general
knowledge is supposed to qualify him to appreciate expert testimony,
and to judge between the experts from different fi elds,
whose power is enhanced. The point which is important for us,
however, is that the scholar who becomes a university president,
the scientist who takes charge of an institute or foundation, the
scholar who becomes an editor or the active promoter of an
organisation serving a particular cause, all rapidly cease to be
scholars or experts and become intellectuals in our sense, people
who judge all issues not by their specifi c merits but, in the characteristic
manner of intellectuals, solely in the light of certain
fashionable general ideas. The number of such institutions which
breed intellectuals and increase their number and powers grows
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every day. Almost all the ‘experts’ in the mere technique of getting
knowledge over are, with respect to the subject matter which they
handle, intellectuals and not experts.
In the sense in which we are using the term, the intellectuals
are in fact a fairly new phenomenon of history. Though nobody
will regret that education has ceased to be a privilege of the propertied
classes, the fact that the propertied classes are no longer the
best educated and the fact that the large number of people who
owe their position solely to their general education do not possess
that experience of the working of the economic system which
the administration of property gives, are important for understanding
the role of the intellectual. Professor Schumpeter, who
has devoted an illuminating chapter of his Capitalism, Socialism,
and Demo cracy to some aspects of our problem, has not unfairly
stressed that it is the absence of direct responsibility for practical
affairs and the consequent absence of fi rst-hand knowledge
of them which distinguishes the typical intellectual from other
people who also wield the power of the spoken and written word.
It would lead too far, however, to examine here further the development
of this class and the curious claim which has recently been
advanced by one of its theorists that it was the only one whose
views were not decidedly infl uenced by its own economic interests.
One of the important points that would have to be examined
in such a discussion would be how far the growth of this class has
been artifi cially stimulated by the law of copyright.1
III
It is not surprising that the real scholar or expert and the practical
man of affairs often feel contemptuous about the intellectual,
are disinclined to recognise his power, and are resentful
when they discover it. Individually they fi nd the intellectuals
mostly to be people who understand nothing in particular especially
well and whose judgement on matters they themselves
understand shows little sign of special wisdom. But it would be
a fatal mistake to underestimate their power for this reason. Even
though their knowledge may be often superfi cial and their intelligence
limited, this does not alter the fact that it is their judgement
which mainly determines the views on which society will act in the
not too distant future. It is no exaggeration to say that, once the
more active part of the intellectuals has been converted to a set
of beliefs, the process by which these become generally accepted
is almost automatic and irresistible. These intellectuals are the
organs which modern society has developed for spreading knowledge
and ideas, and it is their convictions and opinions which
operate as the sieve through which all new conceptions must pass
before they can reach the masses.
It is of the nature of the intellectual’s job that he must use his
own knowledge and convictions in performing his daily task. He
occupies his position because he possesses, or has had to deal from
day to day with, knowledge which his employer in general does
not possess, and his activities can therefore be directed by others
only to a limited extent. And just because the intellectuals are
mostly intellectually honest, it is inevitable that they should follow
their own convictions whenever they have discretion and that
they should give a corresponding slant to everything that passes
through their hands. Even where the direction of policy is in the
1 It would be interesting to discover how far a seriously critical view of the benefi ts
to society of the law of copyright, or the expression of doubts about the public interest
in the existence of a class which makes its living from the writing of books,
would have a chance of being publicly stated in a society in which the channels of
expression are so largely controlled by people who have a vested interest in the
existing situation.
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hands of men of affairs of different views, the execution of policy
will in general be in the hands of intellectuals, and it is frequently
the decision on the detail which determines the net effect. We
fi nd this illustrated in almost all fi elds of contemporary society.
Newspapers in ‘capitalist’ ownership, universities presided over
by ‘reactionary’ governing bodies, broadcasting systems owned
by conservative governments, have all been known to infl uence
public opinion in the direction of socialism, because this was the
conviction of the personnel. This has often happened not only in
spite of, but perhaps even because of, the attempts of those at the
top to control opinion and to impose principles of orthodoxy.
The effect of this fi ltering of ideas through the convictions of
a class which is constitutionally disposed to certain views is by no
means confi ned to the masses. Outside his special fi eld the expert
is generally no less dependent on this class and scarcely less infl uenced
by their selection. The result of this is that today in most
parts of the Western world even the most determined opponents
of socialism derive from socialist sources their knowledge on most
subjects on which they have no fi rst-hand information. With
many of the more general preconceptions of socialist thought, the
connection of their more practical proposals is by no means at
once obvious; in consequence, many men who believe themselves
to be determined opponents of that system of thought become in
fact effective spreaders of its ideas. Who does not know the practical
man who in his own fi eld denounces socialism as ‘pernicious
rot’ but, when he steps outside his subject, spouts socialism like
any Left journalist?
In no other fi eld has the predominant infl uence of the socialist
intellectuals been felt more strongly during the last hundred years
than in the contacts between different national civilisations. It
would go far beyond the limits of this article to trace the causes
and signifi cance of the highly important fact that in the modern
world the intellectuals provide almost the only approach to an
international community. It is this which mainly accounts for
the extraordinary spectacle that for generations the supposedly
‘capitalist’ West has been lending its moral and material support
almost exclusively to those ideological movements in the countries
farther east which aimed at undermining Western civilisation
and that, at the same time, the information which the Western
public has obtained about events in Central and Eastern Europe
has almost inevitably been coloured by a socialist bias. Many of
the ‘educational’ activities of the American forces of occupation
in Germany have furnished clear and recent examples of this
tendency.
IV
A proper understanding of the reasons which tend to incline
so many of the intellectuals towards socialism is thus most
import ant. The fi rst point here which those who do not share this
bias ought to face frankly is that it is neither selfi sh interests nor
evil intentions but mostly honest convictions and good intentions
which determine the intellectuals’ views. In fact, it is necessary to
recognise that on the whole the typical intellectual is today more
likely to be a socialist the more he is guided by good will and intelligence,
and that on the plane of purely intellectual argument he
will generally be able to make out a better case than the majority
of his opponents within his class. If we still think him wrong, we
must recognise that it may be genuine error which leads the wellmeaning
and intelligent people who occupy those key positions
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in our society to spread views which to us appear a threat to our
civilisation.2 Nothing could be more important than to try to
understand the sources of this error in order that we should be
able to counter it. Yet those who are generally regarded as the
representatives of the existing order and who believe that they
comprehend the dangers of socialism are usually very far from
such understanding. They tend to regard the socialist intellectuals
as nothing more than a pernicious bunch of highbrow radicals
without appreciating their infl uence and, by their whole attitude
to them, tend to drive them even further into opposition to the
existing order.
If we are to understand this peculiar bias of a large section of
the intellectuals, we must be clear about two points. The fi rst is
that they generally judge all particular issues exclusively in the
light of certain general ideas; the second, that the characteristic
errors of any age are frequently derived from some genuine new
truths it has discovered, and they are erroneous applications of
new generalisations which have proved their value in other fi elds.
The conclusion to which we shall be led by a full consideration of
these facts will be that the effective refutation of such errors will
frequently require further intellectual advance, and often advance
on points which are very abstract and may seem very remote from
the practical issues.
It is perhaps the most characteristic feature of the intellectual
that he judges new ideas not by their specifi c merits but by the
readiness with which they fi t into his general conceptions, into the
picture of the world which he regards as modern or advanced. It
is through their infl uence on him and on his choice of opinions on
particular issues that the power of ideas for good and evil grows in
proportion to their generality, abstractness, and even vagueness.
As he knows little about the particular issues, his criterion must
be consistency with his other views and suitability for combining
into a coherent picture of the world. Yet this selection from the
multitude of new ideas presenting themselves at every moment
creates the characteristic climate of opinion, the dominant Weltanschauung
of a period, which will be favourable to the reception of
some opinions and unfavourable to others and which will make
the intellectual readily accept one conclusion and reject another
without a real understanding of the issues.
In some respects the intellectual is indeed closer to the philosopher
than to any specialist, and the philosopher is in more than
one sense a sort of prince among the intellectuals. Although his
infl uence is farther removed from practical affairs and correspondingly
slower and more diffi cult to trace than that of the ordinary
intellectual, it is of the same kind and in the long run even more
powerful than that of the latter. It is the same endeavour towards
a synthesis, pursued more methodically, the same judgement
of particular views in so far as they fi t into a general system of
thought rather than by their specifi c merits, the same striving
after a consistent world view, which for both forms the main basis
for accepting or rejecting ideas. For this reason the philo sopher
has probably a greater infl uence over the intellectuals than any
other scholar or scientist and, more than anyone else, determines
the manner in which the intellectuals exercise their censorship
function. The popular infl uence of the scientifi c specialist begins to
rival that of the philosopher only when he ceases to be a specialist
2 It was therefore not (as has been suggested by one reviewer of The Road to Serfdom,
Professor J. Schumpeter) ‘politeness to a fault’ but profound conviction of
the importance of this which made me, in Professor Schumpeter’s words, ‘hardly
ever attribute to opponents anything beyond intellectual error’.
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and commences to philosophise about the progress of his subject
– and usually only after he has been taken up by the intellectuals
for reasons which have little to do with his scientifi c eminence.
The ‘climate of opinion’ of any period is thus essentially a set
of very general preconceptions by which the intellectual judges
the importance of new facts and opinions. These preconceptions
are mainly applications to what seem to him the most signifi cant
aspects of scientifi c achievements, a transfer to other fi elds of
what has particularly impressed him in the work of the specialists.
One could give a long list of such intellectual fashions and catchwords
which in the course of two or three generations have in
turn dominated the thinking of the intellectuals. Whether it was
the ‘historical approach’ or the theory of evolution, nineteenthcentury
determinism and the belief in the predominant infl uence
of environment as against heredity, the theory of relativity or the
belief in the power of the unconscious – every one of these general
conceptions has been made the touchstone by which innovations
in different fi elds have been tested. It seems as if the less specifi c
or precise (or the less understood) these ideas are, the wider may
be their infl uence. Sometimes it is no more than a vague impression
rarely put into words which thus wields a profound infl uence.
Such beliefs as that deliberate control or conscious organisation is
also in social affairs always superior to the results of spontaneous
processes which are not directed by a human mind, or that any
order based on a plan laid down beforehand must be better than
one formed by the balancing of opposing forces, have in this way
profoundly affected political development.
Only apparently different is the role of the intellectuals where
the development of more properly social ideas is concerned. Here
their peculiar propensities manifest themselves in making shibboleths
of abstractions, in rationalising and carrying to extremes
certain ambitions which spring from the normal intercourse of
men. Since democracy is a good thing, the further the democratic
principle can be carried, the better it appears to them. The most
powerful of these general ideas which have shaped political development
in recent times is of course the ideal of material equality.
It is, characteristically, not one of the spontaneously grown moral
convictions, fi rst applied in the relations between particular individuals,
but an intellectual construction originally conceived in
the abstract and of doubtful meaning or application in particular
instances. Nevertheless, it has operated strongly as a principle of
selection among the alternative courses of social policy, exercising
a persistent pressure towards an arrangement of social affairs
which nobody clearly conceives. That a particular measure tends
to bring about greater equality has come to be regarded as so
strong a recommendation that little else will be considered. Since
on each particular issue it is this one aspect on which those who
guide opinion have a defi nite conviction, equality has determined
social change even more strongly than its advocates intended.
Not only moral ideals act in this manner, however. Sometimes
the attitudes of the intellectuals towards the problems of social
order may be the consequence of advances in purely scientifi c
knowledge, and it is in these instances that their erroneous views
on particular issues may for a time seem to have all the prestige of
the latest scientifi c achievements behind them. It is not in itself
surprising that a genuine advance of knowledge should in this
manner become on occasion a source of new error. If no false
conclusions followed from new generalisations, they would be
fi nal truths which would never need revision. Although as a rule
such a new generalisation will merely share the false consequences
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which can be drawn from it with the views which were held
before, and thus not lead to new error, it is quite likely that a new
theory, just as its value is shown by the valid new conclusions to
which it leads, will produce other new conclusions which further
advance will show to have been erroneous. But in such an instance
a false belief will appear with all the prestige of the latest scientifi
c knowledge supporting it. Although in the particular fi eld to
which this belief applies all the scientifi c evidence may be against
it, it will nevertheless, before the tribunal of the intellectuals and
in the light of the ideas which govern their thinking, be selected
as the view which is best in accord with the spirit of the time. The
specialists who will thus achieve public fame and wide infl uence
will thus not be those who have gained recognition by their peers
but will often be men whom the other experts regard as cranks,
amateurs, or even frauds, but who in the eyes of the general public
nevertheless become the best known exponents of their subject.
In particular, there can be little doubt that the manner in
which during the last hundred years man has learned to organise
the forces of nature has contributed a great deal towards the
creation of the belief that a similar control of the forces of society
would bring comparable improvements in human conditions.
That, with the application of engineering techniques, the direction
of all forms of human activity according to a single coherent
plan should prove to be as successful in society as it has been in
innumerable engineering tasks, is too plausible a conclusion not
to seduce most of those who are elated by the achievement of the
natural sciences. It must indeed be admitted both that it would
require powerful arguments to counter the strong presumption
in favour of such a conclusion and that these arguments have not
yet been adequately stated. It is not suffi cient to point out the
defects of particular proposals based on this kind of reasoning.
The argument will not lose its force until it has been conclusively
shown why what has proved so eminently successful in producing
advances in so many fi elds should have limits to its usefulness and
become positively harmful if extended beyond these limits. This is
a task which has not yet been satisfactorily performed and which
will have to be achieved before this particular impulse towards
socialism can be removed.
This, of course, is only one of many instances where further
intellectual advance is needed if the harmful ideas at present
current are to be refuted and where the course which we shall
travel will ultimately be decided by the discussion of very abstract
issues. It is not enough for the man of affairs to be sure, from
his intimate knowledge of a particular fi eld, that the theories of
socialism which are derived from more general ideas will prove
impracticable. He may be perfectly right, and yet his resistance
will be overwhelmed and all the sorry consequences which he
foresees will follow if he is not supported by an effective refutation
of the idées mères. So long as the intellectual gets the better of the
general argument, the most valid objections to the specifi c issue
will be brushed aside.
V
This is not the whole story, however. The forces which infl uence
recruitment to the ranks of the intellectuals operate in the
same direction and help to explain why so many of the most
able among them lean towards socialism. There are of course
as many differences of opinion among intellectuals as among
other groups of people; but it seems to be true that it is on the
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whole the more active, intelligent, and original men among the
intellectuals who most frequently incline towards socialism,
while its opponents are often of an inferior calibre. This is true
particularly during the early stages of the infi ltration of socialist
ideas; later, although outside intellectual circles it may still be
an act of courage to profess socialist convictions, the pressure of
opinion among intellectuals will often be so strongly in favour of
socialism that it requires more strength and independence for a
man to resist it than to join in what his fellows regard as modern
views. Nobody, for instance, who is familiar with large numbers
of university faculties (and from this point of view the majority
of university teachers probably have to be classed as intellectuals
rather than as experts) can remain oblivious to the fact that the
most brilliant and successful teachers are today more likely than
not to be socialists, while those who hold more conservative
political views are as frequently mediocrities. This is of course
by itself an important factor leading the younger generation into
the socialist camp.
The socialist will, of course, see in this merely a proof that
the more intelligent person is today bound to become a socialist.
But this is far from being the necessary or even the most likely
explana tion. The main reason for this state of affairs is probably
that, for the exceptionally able man who accepts the present order
of society, a multitude of other avenues to infl uence and power
are open, while to the disaffected and dissatisfi ed an intellectual
career is the most promising path to both infl uence and the power
to contribute to the achievement of his ideals. Even more than
that: the more conservatively inclined man of fi rst class ability will
in general choose intellectual work (and the sacrifi ce in material
reward which this choice usually entails) only if he enjoys it for its
own sake. He is in consequence more likely to become an expert
scholar rather than an intellectual in the specifi c sense of the word;
while to the more radically minded the intellectual pursuit is more
often than not a means rather than an end, a path to exactly that
kind of wide infl uence which the professional intellectual exercises.
It is therefore probably the fact, not that the more intelligent
people are generally socialists, but that a much higher proportion
of socialists among the best minds devote themselves to those
intellectual pursuits which in modern society give them a decisive
infl uence on public opinion.3
The selection of the personnel of the intellectuals is also closely
connected with the predominant interest which they show in
general and abstract ideas. Speculations about the possible entire
reconstruction of society give the intellectual a fare much more to
his taste than the more practical and short-run considerations of
those who aim at a piecemeal improvement of the existing order.
In particular, socialist thought owes its appeal to the young largely
to its visionary character; the very courage to indulge in Utopian
thought is in this respect a source of strength to the socialists
which traditional liberalism sadly lacks. This difference operates
in favour of socialism, not only because speculation about general
principles provides an opportunity for the play of the imagination
3 Related to this is another familiar phenomenon: there is little reason to believe
that really fi rst-class intellectual ability for original work is any rarer among
Gentiles than among Jews. Yet there can be little doubt that men of Jewish stock
almost everywhere constitute a disproportionately large number of the intellectuals
in our sense, that is of the ranks of the professional interpreters of ideas.
This may be their special gift and certainly is their main opportunity in countries
where prejudice puts obstacles in their way in other fi elds. It is probably more because
they constitute so large a proportion of the intellectuals than for any other
reason that they seem to be so much more receptive to socialist ideas than people
of different stocks.
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of those who are unencumbered by much knowledge of the facts
of present-day life, but also because it satisfi es a legitimate desire
for the understanding of the rational basis of any social order and
gives scope for the exercise of that constructive urge for which
liberalism, after it had won its great victories, left few outlets. The
intellectual, by his whole disposition, is uninterested in technical
details or practical diffi culties. What appeal to him are the broad
visions, the specious comprehension of the social order as a whole
which a planned system promises.
This fact that the tastes of the intellectual were better satisfi
ed by the speculations of the socialists proved fatal to the infl uence
of the liberal tradition. Once the basic demands of the liberal
programmes seemed satisfi ed, the liberal thinkers turned to
problems of detail and tended to neglect the development of the
general philosophy of liberalism, which in consequence ceased
to be a live issue offering scope for general speculation. Thus for
something over half a century it has been only the socialists who
have offered anything like an explicit programme of social development,
a picture of the future society at which they were aiming,
and a set of general principles to guide decisions on particular
issues. Even though, if I am right, their ideals suffer from inherent
contradictions, and any attempt to put them into practice must
produce something utterly different from what they expect, this
does not alter the fact that their programme for change is the only
one which has actually infl uenced the development of social institutions.
It is because theirs has become the only explicit general
philosophy of social policy held by a large group, the only system
or theory which raises new problems and opens new horizons,
that they have succeeded in inspiring the imagination of the intellectuals.
The actual developments of society during this period were
determined not by a battle of confl icting ideals, but by the
contrast between an existing state of affairs and that one ideal of
a possible future society which the socialists alone held up before
the public. Very few of the other programmes which offered themselves
provided genuine alternatives. Most of them were mere
compromises or half-way houses between the more extreme types
of socialism and the existing order. All that was needed to make
almost any socialist proposal appear reasonable to these ‘judicious’
minds who were constitutionally convinced that the truth must
always lie in the middle between the extremes, was for someone
to advocate a suffi ciently more extreme proposal. There seemed
to exist only one direction in which we could move, and the only
question seemed to be how fast and how far the movement should
proceed.
VI
The signifi cance of the special appeal to the intellectuals which
socialism derives from its speculative character will become
clearer if we further contrast the position of the socialist theorist
with that of his counterpart who is a liberal in the old sense of the
word. This comparison will also lead us to whatever lesson we
can draw from an adequate appreciation of the intellectual forces
which are undermining the foundations of a free society.
Paradoxically enough, one of the main handicaps which
deprives the liberal thinker of popular infl uence is closely
connected with the fact that, until socialism has actually arrived,
he has more opportunity of directly infl uencing decisions on
current policy and that in consequence he is not only not tempted
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into that long-run speculation which is the strength of the socialists,
but is actually discouraged from it because any effort of this
kind is likely to reduce the immediate good he can do. Whatever
power he has to infl uence practical decisions he owes to his
standing with the representatives of the existing order, and this
standing he would endanger if he devoted himself to the kind of
speculation which would appeal to the intellectuals and which
through them could infl uence developments over longer periods.
In order to carry weight with the powers that be, he has to be
‘practical’, ‘sensible’, and ‘realistic’. So long as he concerns himself
with immediate issues, he is rewarded with infl uence, material
success, and popularity with those who up to a point share his
general outlook. But these men have little respect for those speculations
on general principles which shape the intellectual climate.
Indeed, if he seriously indulges in such long-run speculation, he
is apt to acquire the reputation of being ‘unsound’ or even half a
socialist, because he is unwilling to identify the existing order with
the free system at which he aims.4
If, in spite of this, his efforts continue in the direction of
general speculation, he soon discovers that it is unsafe to associate
too closely with those who seem to share most of his convictions,
and he is soon driven into isolation. Indeed there can be few more
thankless tasks at present than the essential one of developing the
philosophical foundation on which the further development of a
free society must be based. Since the man who undertakes it must
accept much of the framework of the existing order, he will appear
to many of the more speculatively minded intellectuals merely as
a timid apologist of things as they are; at the same time he will
be dismissed by the men of affairs as an impractical theorist. He
is not radical enough for those who know only the world where
‘with ease together dwell the thoughts’ and much too radical for
those who see only how ‘hard in space together clash the things’.
If he takes advantage of such support as he can get from the men
of affairs, he will almost certainly discredit himself with those
on whom he depends for the spreading of his ideas. At the same
time he will need most carefully to avoid anything resembling
extravagance or overstatement. While no socialist theorist has
ever been known to discredit himself with his fellows even by the
silliest of proposals, the old-fashioned liberal will damn himself
by an impracticable suggestion. Yet for the intellectuals he will
still not be speculative or adventurous enough, and the changes
and improvements in the social structure he will have to offer will
seem limited in comparison with what their less restrained imagination
conceives.
At least in a society in which the main requisites of freedom
have already been won and further improvements must concern
points of comparative detail, the liberal programme can have
none of the glamour of a new invention. The appreciation of
the improvements it has to offer requires more knowledge of
the working of the existing society than the average intellectual
possesses. The discussion of these improvements must proceed
on a more practical level than that of the more revolutionary
4 The most glaring recent example of such condemnation of a somewhat unorthodox
liberal work as ‘socialist’ has been provided by some comments on the late
Henry Simons’s Economic Policy for a Free Society (1948). One need not agree with
the whole of this work and one may even regard some of the suggestions made in
it as incompatible with a free society, and yet recognise it as one of the most important
contributions made in recent times to our problem and as just the kind of
work which is required to get discussion started on the fundamental issues. Even
those who violently disagree with some of its suggestions should welcome it as a
contribution which clearly and courageously raises the central problems of our
time.
the intellecua l s a n d s o c i a l i s m
126 127
t h e i n t e l l e c t ua l s a n d s o c i a l i s m
programmes, thus giving a complexion which has little appeal
for the intellectual and tending to bring in elements to whom
he feels directly antagonistic. Those who are most familiar with
the working of the present society are also usually interested in
the preservation of particular features of that society which may
not be defensible on general principles. Unlike the person who
looks for an entirely new future order and who naturally turns for
guidance to the theorist, the men who believe in the existing order
also usually think that they understand it much better than any
theorist and in consequence are likely to reject whatever is unfamiliar
and theoretical.
The diffi culty of fi nding genuine and disinterested support for
a systematic policy for freedom is not new. In a passage of which
the reception of a recent book of mine has often reminded me,
Lord Acton long ago described how:
at all times sincere friends of freedom have been rare, and its
triumphs have been due to minorities, that have prevailed
by associating themselves with auxiliaries whose objects
differed from their own; and this association, which is
always dangerous, has been sometimes disastrous, by giving
to opponents just grounds of opposition. . . 5
More recently, one of the most distinguished living American
economists has complained in a similar vein that the main task of
those who believe in the basic principles of the capitalist system
must frequently be to defend this system against the capitalists
– indeed the great liberal economists, from Adam Smith to the
present, have always known this.
The most serious obstacle which separates the practical men
who have the cause of freedom genuinely at heart from those forces
which in the realm of ideas decide the course of development is
their deep distrust of theoretical speculation and their tendency
to orthodoxy; this, more than anything else, creates an almost
impassable barrier between them and those intellectuals who
are devoted to the same cause and whose assistance is indispensable
if the cause is to prevail. Although this tendency is perhaps
natural among men who defend a system because it has justifi ed
itself in practice, and to whom its intellectual justifi cation seems
immaterial, it is fatal to its survival because it deprives it of the
support it most needs. Orthodoxy of any kind, any pretence that
a system of ideas is fi nal and must be unquestioningly accepted as
a whole, is the one view which of necessity antagonises all intellectuals,
whatever their views on particular issues. Any system which
judges men by the completeness of their conformity to a fi xed set
of opinions, by their ‘soundness’ or the extent to which they can
be relied upon to hold approved views on all points, deprives itself
of a support without which no set of ideas can maintain its infl uence
in modern society. The ability to criticise accepted views,
to explore new vistas and to experiment with new conceptions,
provides the atmosphere without which the intellectual cannot
breathe. A cause which offers no scope for these traits can have
no support from him and is thereby doomed in any society which,
like ours, rests on his services.
VII
It may be that a free society as we have known it carries in itself the
forces of its own destruction, that once freedom has been achieved
5 Acton, The History of Freedom, London, 1922. it is taken for granted and ceases to be valued, and that the free
the intellecua l s a n d s o c i a l i s m
128 129
t h e i n t e l l e c t ua l s a n d s o c i a l i s m
growth of ideas which is the essence of a free society will bring
about the destruction of the foundations on which it depends.
There can be little doubt that in countries like the United States
the ideal of freedom has today less real appeal for the young than
it has in countries where they have learned what its loss means.
On the other hand, there is every sign that in Germany and elsewhere,
to the young men who have never known a free society, the
task of constructing one can become as exciting and fascinating as
any socialist scheme which has appeared during the last hundred
years. It is an extraordinary fact, though one which many visitors
have experienced, that in speaking to German students about the
principles of a liberal society one fi nds a more responsive and
even enthusiastic audience than one can hope to fi nd in any of the
Western democracies. In Britain also there is already appearing
among the young a new interest in the principles of true liberalism
which certainly did not exist a few years ago.
Does this mean that freedom is valued only when it is lost,
that the world must everywhere go through a dark phase of
socialist totalitarianism before the forces of freedom can gather
strength anew? It may be so, but I hope it need not be. Yet, so long
as the people who over longer periods determine public opinion
continue to be attracted by the ideals of socialism, the trend will
continue. If we are to avoid such a development, we must be able
to offer a new liberal programme which appeals to the imagination.
We must make the building of a free society once more an
intellectual adventure, a deed of courage. What we lack is a liberal
Utopia, a programme which seems neither a mere defence of
things as they are nor a diluted kind of socialism, but a truly liberal
radicalism which does not spare the susceptibilities of the mighty
(including the trade unions), which is not too severely practical,
and which does not confi ne itself to what appears today as politically
possible. We need intellectual leaders who are prepared to
resist the blandishments of power and infl uence and who are
willing to work for an ideal, however small may be the prospects
of its early realisation. They must be men who are willing to stick
to principles and to fi ght for their full realisation, however remote.
The practical compromises they must leave to the politicians.
Free trade and freedom of opportunity are ideals which still may
arouse the imaginations of large numbers, but a mere ‘reasonable
freedom of trade’ or a mere ‘relaxation of controls’ is neither intellectually
respectable nor likely to inspire any enthusiasm.
The main lesson which the true liberal must learn from the
success of the socialists is that it was their courage to be Utopian
which gained them the support of the intellectuals and therefore
an infl uence on public opinion which is daily making possible
what only recently seemed utterly remote. Those who have
concerned themselves exclusively with what seemed practicable in
the existing state of opinion have constantly found that even this
has rapidly become politically impossible as the result of changes
in a public opinion which they have done nothing to guide. Unless
we can make the philosophic foundations of a free society once
more a living intellectual issue, and its implementation a task
which challenges the ingenuity and imagination of our liveliest
minds, the prospects of freedom are indeed dark. But if we can
regain that belief in the power of ideas which was the mark of
liberalism at its best, the battle is not lost. The intellectual revival
of liberalism is already under way in many parts of the world. Will
it be in time?
Director General John Blundell
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131
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ABOUT THE IEA
130
Other papers recently published by the IEA include:
WHO, What and Why?
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Roger Scruton
Occasional Paper 113; ISBN 0 255 36487 3
£8.00
The World Turned Rightside Up
A New Trading Agenda for the Age of Globalisation
John C. Hulsman
Occasional Paper 114; ISBN 0 255 36495 4
£8.00
The Representation of Business in English Literature
Introduced and edited by Arthur Pollard
Readings 53; ISBN 0 255 36491 1
£12.00
Anti-Liberalism 2000
The Rise of New Millennium Collectivism
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Occasional Paper 115; ISBN 0 255 36497 0
£7.50
Capitalism, Morality and Markets
Brian Griffi ths, Robert A. Sirico, Norman Barry & Frank Field
Readings 54; ISBN 0 255 36496 2
£7.50
A Conversation with Harris and Seldon
Ralph Harris & Arthur Seldon
Occasional Paper 116; ISBN 0 255 36498 9
£7.50
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Occasional Paper 117; ISBN 0 255 36499 7
£10.00
A Plea to Economists Who Favour Liberty:
Assist the Everyman
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Occasional Paper 118; ISBN 0 255 36501 2
£10.00
The Changing Fortunes of Economic Liberalism
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Occasional Paper 105 (new edition); ISBN 0 255 36520 9
£12.50
The Global Education Industry
Lessons from Private Education in Developing Countries
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Hobart Paper 141 (new edition); ISBN 0 255 36503 9
£12.50
Saving Our Streams
The Role of the Anglers’ Conservation Association in
Protecting English and Welsh Rivers
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Research Monograph 53; ISBN 0 255 36494 6
£10.00
Better Off Out?
The Benefi ts or Costs of EU Membership
Brian Hindley & Martin Howe
Occasional Paper 99 (new edition); ISBN 0 255 36502 0
£10.00
Buckingham at 25
Freeing the Universities from State Control
Edited by James Tooley
Readings 55; ISBN 0 255 36512 8
£15.00
Lectures on Regulatory and Competition Policy
Irwin M. Stelzer
Occasional Paper 120; ISBN 0 255 36511 X
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Misguided Virtue
False Notions of Corporate Social Responsibility
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Hobart Paper 142; ISBN 0 255 36510 1
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HIV and Aids in Schools
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Occasional Paper 121; ISBN 0 255 36522 5
£10.00
The Road to Serfdom
The Reader’s Digest condensed version
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Occasional Paper 122; ISBN 0 255 36530 6
£7.50
Bastiat’s The Law
Introduction by Norman Barry
Occasional Paper 123; ISBN 0 255 36509 8
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A Globalist Manifesto for Public Policy
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Occasional Paper 124; ISBN 0 255 36525 X
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Euthanasia for Death Duties
Putting Inheritance Tax Out of Its Misery
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Research Monograph 54; ISBN 0 255 36513 6
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The Case for Private Land-use Planning
Mark Pennington
Hobart Paper 143; ISBN 0 255 36508 x
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IEA Yearbook of Government Performance
2002/2003
Edited by Peter Warburton
Yearbook 1; ISBN 0 255 36532 2
£15.00
Britain’s Relative Economic Performance, 1870–
1999
Nicholas Crafts
Research Monograph 55; ISBN 0 255 36524 1
£10.00
Should We Have Faith in Central Banks?
Otmar Issing
Occasional Paper 125; ISBN 0 255 36528 4
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The Dilemma of Democracy
Arthur Seldon
Hobart Paper 136 (reissue); ISBN 0 255 36536 5
£10.00
Capital Controls: a ‘Cure’ Worse Than the Problem?
Forrest Capie
Research Monograph 56; ISBN 0 255 36506 3
£10.00
The Poverty of ‘Development Economics’
Deepak Lal
Hobart Paper 144 (reissue); ISBN 0 255 36519 5
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Should Britain Join the Euro?
The Chancellor’s Five Tests Examined
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Occasional Paper 126; ISBN 0 255 36527 6
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Post-Communist Transition: Some Lessons
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Occasional Paper 127; ISBN 0 255 36533 0
£7.50
A Tribute to Peter Bauer
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Occasional Paper 128; ISBN 0 255 36531 4
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Employment Tribunals
Their Growth and the Case for Radical Reform
J. R. Shackleton
Hobart Paper 145; ISBN 0 255 36515 2
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Fifty Economic Fallacies Exposed
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Occasional Paper 129; ISBN 0 255 36518 7
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A Market in Airport Slots
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Readings 56; ISBN 0 255 36505 5
£10.00
Money, Infl ation and the Constitutional Position of
the Central Bank
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Readings 57; ISBN 0 255 36538 1
£10.00
railway.com
Parallels between the Early British Railways and the ICT Revolution
Robert C. B. Miller
Research Monograph 57; ISBN 0 255 36534 9
£12.50
The Regulation of Financial Markets
Edited by Philip Booth & David Currie
Readings 58; ISBN 0 255 36551 9
£12.50
Climate Alarmism Reconsidered
Robert L. Bradley Jr
Hobart Paper 146; ISBN 0 255 36541 1
£12.50
Government Failure: E. G. West on Education
Edited by James Tooley & James Stanfi eld
Occasional Paper 130; ISBN 0 255 36552 7
£12.50
Waging the War of Ideas
John Blundell
Second edition
Occasional Paper 131; ISBN 0 255 36547 0
£12.50
Corporate Governance: Accountability in
the Marketplace
Elaine Sternberg
Second edition
Hobart Paper 147; ISBN 0 255 36542 X
£12.50
The Land Use Planning System
Evaluating Options for Reform
John Corkindale
Hobart Paper 148; ISBN 0 255 36550 0
£10.00
Economy and Virtue
Essays on the Theme of Markets and Morality
Edited by Dennis O’Keeffe
Readings 59; ISBN 0 255 36504 7
£12.50
Free Markets Under Siege
Cartels, Politics and Social Welfare
Richard A. Epstein
Occasional Paper 132; ISBN 0 255 36553 5
£10.00
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D. R. Myddelton
Hobart Paper 149; ISBN 0 255 36559 4
£12.50
The Euro as Politics
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Research Monograph 58; ISBN 0 255 36535 7
£12.50
Pricing Our Roads
Vision and Reality
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Research Monograph 59; ISBN 0 255 36562 4
£10.00
The Role of Business in the Modern World
Progress, Pressures, and Prospects for the Market Economy
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Hobart Paper 150; ISBN 0 255 36548 9
£12.50
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Occasional Paper 133; ISBN 0 255 36565 9
£10.00
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Otmar Issing
Occasional Paper 134; ISBN 0 255 36555 1
£10.00
Towards a Liberal Utopia?
Edited by Philip Booth
Hobart Paperback 32; ISBN 0 255 36563 2
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Philip Booth & Deborah Cooper
Research Monograph 60; ISBN 0 255 36517 9
£12.50
Black Wednesday
A Re-examination of Britain’s Experience in the Exchange Rate Mechanism
Alan Budd
Occasional Paper 135; ISBN 0 255 36566 7
£7.50
Crime: Economic Incentives and Social Networks
Paul Ormerod
Hobart Paper 151; ISBN 0 255 36554 3
£10.00
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